GST Council Meet: Rates on 29 goods, 53 services revised
At the 25th GST Council Meeting, convened in New Delhi, the highest decision-making authority on Goods and Services Tax (GST) has revised the tax rates on as many as 29 items and 53 services. The panel led by Union Finance Minister Arun Jaitley said the new GST rates on these goods and services will come into effect from 25 January. Here's the list.
GST rates have been reduced on these items
The GST Council has cut the tax rate on domestic LPG provided by private companies from 18% to 5%. Ambulance vehicles and rice bran will now attract 0% GST instead of the 15% and 5% rates, respectively, earlier. The tax rate for mining and drilling of natural gas has been reduced to 12%. Also, bio-diesel will now attract 12% GST instead of 18%.
Motor vehicles will attract 18% GST compared to 28% earlier
The apex GST body also slashed the GST rate on motor vehicles from 28% to 18%. GST on packaged drinking water (20-liter bottles), sugar boiled confectionery, drip irrigation system, and mechanical sprayer has been cut from 18% to 12%. Meanwhile, velvet fabric also saw a tax rate cut from 12% to 5%. GST rate on mehendi cones is decreased to 5% from 18%.
GST on 28 handicraft items at 0%: Uttarakhand Finance Minister
However, the GST Council has decided to increase the tax rate on cigarette filter rods to 18% from 12% earlier. The panel also reportedly cut rates for some goods in the 12-18% GST bracket, including some agriculture-related items. Meanwhile, Finance Minister of Uttarakhand, Prakash Pant, stated that as many as 28 handicraft items will now attract 0% GST.
Panel's decision on simplifying GSTR filing pending
GST Council has, however, not finalized the decision on the simplification of GST filing process. GST service-provider Infosys's Nandan Nilekani gave a presentation on the matter, which will be discussed again in ten days. The panel was expected to get rid of multiple GSTR forms. GSTR-1, 2, 3 forms could be combined under a single "simplified" one for small traders under composition scheme.
Composition scheme: There could be cases of under-declaration, says Jaitley
Jaitley stated the inter-state electronic-way bill system would be compulsory from 1 February. He added 15 states have so far agreed for rolling out the e-way bill mechanism for intra-state trade, too. Reviewing the GST revenue collection, Jaitley said composition scheme collection wasn't encouraging, He also added, "GST Panel also decided to divide Rs. 35,000 crore IGST (Integrated GST) collections between Centre, states."
What about bringing petroleum products under GST?
GST panel didn't discuss anything about bringing petroleum products under the GST ambit. Jaitley stated, "Today it (petrol/diesel under GST) was not discussed...it will be discussed in the next meeting." Also, they didn't reach a conclusion on bringing real estate under the GST net.
