After cutting GST rate on 178 items, it is likely that the GST Council will slash rates on electronic items like washing machine, refrigerator, AC etc, which are in the top 28% slot, in the next round of rationalisation.
After cutting GST rate on 178 items, it is likely that the GST Council will slash rates on electronic items like washing machine, refrigerator, AC etc, which are in the top 28% slot, in the next round of rationalisation. The move is highly expected as the GST Council, chaired by Finance Minister, hinted that only luxury or sin goods are going to stay in the top slot, and there would be more rationalisation in future.
The government is looking to reduce tax rates on consumer durable goods like washing machines and refrigerators from current 28% to 18%, The Times of India reported citing a government official. The move is likely to be made to reduce the workload on women who are the largest consumers of these white goods, the report said.
Finance Minister Arun Jaitley has hinted at further GST rate cuts in future depending on “revenue buoyancy”. While rejecting the idea of the single tax system, Arun Jaitley said, “Rationalisation process in the transition will always continue. So, wherever there is scope for improvement and procedural simplification will always continue.”
The GST Council, which is headed by Arun Jaitley, brought down tax rate on 178 products from 28% to 18% and pushed down several others in the lower bracket, and decided to bring down compliance burden. The ministers who were part of the GST Council hinted that the Council plans to keep only luxury and sin goods under the 28% slab, and in future, may even move to a two-rate structure.
Currently, the GST regime slots items under four primary tax rate slabs — low rate of 5%, standard rates of 12% and 18%, and high rate of 28%. Other than this, gold and jewellery are taxed at a concessional GST rate of 3%, while rough diamonds are having a 0.25% levy. The items of daily use have been kept tax-free, ie, either at zero tax rate or completely out of the ambit of tax under GST. Apart from this, an additional cess varying for item-to-item is levied — as in case of cigarettes and luxury cars — on sin and luxury items.