In some great news for customers, cab rides can get marginally cheaper after the implementation of GST from July 1, reported news agency PTI. After the implementation of the bill, the tax levied on cab aggregators like Ola and Uber will come down from six percent to 5 percent making travelling cheaper. “Such reduction is a welcome move for cab aggregators and consumers considering the increased demand of services of cab aggregators,” Deloitte Haskins & Sells Senior Director Saloni Roy was quoted saying by the agency.
She further added that it will also provide a boost to already thriving operations of cab aggregators. The introduction of services by cab aggregators has seen manifold growth due to the ease and reasonableness of prices at which the services are offered. “The GST rate on cab aggregators is proposed to be at 5 percent as compared to the current abated service tax rate of 6 percent. This is the rate closest in the various bands of GST rates of 5, 12, 18 and 28 percent,” Roy said.
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Meanwhile, Amit Jain, President of Uber India and South Asia also welcomed the move. “By ensuring that the new rate structure is not inflationary, the government has demonstrated its pro-consumer, pro-business stance,” he said. The council decided to keep the tax in the lower bracket for transport services, since most such services, such as air transport and goods transport, use petroleum products as primary input, which is outside the ambit of GST, Finance Minister Arun Jaitley said earlier in the day.
Under the new GST, regime, 81% of the items have been kept at the lower tax slabs of 5%, 12% and 18%, while exempting from tax essential daily consumption Items including, fresh meat, fish, chicken, eggs, milk, curd, natural honey, fresh fruits, vegetables, flour and bread. While certain luxury goods and sin goods would attract a higher tax of 28% and in some cases.