There were expectations that several items of frequent consumption may be brought down to 5% tax slab from 12% at present, and the tax rate on some other items in the highest tax bracket of 28% too might be reduced.
This news might come to you as a big blow if you were waiting with baited breath for a tax cut on several items of common and not so common use. The GST Council, in its 22nd meeting today in New Delhi, has apparently skipped the discussion on cutting tax rates on the remaining 60 of the 100 items under review, and has instead chosen to focus on straightening out administrative and procedural issues to make the implementation of the tax reform simpler for business owners.
There was no discussion on cutting the tax rates today, Uttarakhand Chief Minister Prakash Pant said today on the sidelines of a crucial review meeting, ahead of a formal briefing. The discussions in the GST Council meeting today revolved around the procedural difficulties in implementing the Goods and Services — the biggest tax reform India has seen since independence — Prakash Pant told reporters outside the meeting venue in Hindi. There was a discussion on what all and how much of difficulties were being faced by businesses, he added.
The GST Council, in its last meeting on September 9 in Hyderabad, lowered tax on as many as 40 daily use items of the 100 items identified. The council had also lowered the GST rates for a number of daily-use products ranging from idli/dosa batter to kitchen gas lighter. Earlier, news reports said that GST Council may take up the remaining 60 items for lowering the tax in today’s meeting. There were expectations that several items of frequent consumption may be brought down to 5% tax slab from 12% at present, and the tax rate on some other items in the highest tax bracket of 28% too might be reduced.
Meanwhile, in a relief to business owners, The GST Council has ‘almost’ agreed to increase the revenue threshold for availing the benefit of the composition scheme to Rs 1 crore from the present Rs 75 lakh, Prakash Pant said. This will bring big relief to many more small businesses, who will have the convenience of paying a flat rate of 1%, 2% or 5%, and avoid a lot of paperwork. Albeit, this might also come as a disappointment to many, as it was being widely speculated that the limit would be raised to Rs 1.5 crore in today’s meeting.