The Goods and Services Tax Council, led by Finance Minister Nirmala Sitharaman, is likely to roll out new tax slabs for goods by September 22, according to information from government sources shared with NDTV.
On August 15, Prime Minister Narendra Modi announced that bring next-generation GST reforms that will facilitate tax load on the country.
“The government will bring next-generation GST reforms, which will bring down the tax burden on the common man. It will be a Diwali gift for you,” he expressed while addressing the nation on the 79th Independence Day.
On September 3-4, the GST council, which includes finance ministers of all states and UTs besides the Centre, will meet to discuss the proposed easier two-tier GST tax slab of 5% and 18% proposed by the Centre.
The notification will be introduced nearly 5 to 7 days after the decision of the GST council.
Under the proposed reform by the centre to the Group of Ministers (GoM), GST must be a two-rate structure of 5 and 18 per cent, categorising goods and services as ‘merit’ and ‘standard’. On the specific items like ultra-luxury cars and sin goods, a special 40% rate will be imposed.
At present, GST is a 4-tier structure of 5, 12, 18, and 28 per cent.
As per the Centre, the GST reforms are based on three pillars – structural reforms, rate rationalisation, and ease of living – in line with the government’s move to make India “atmanirbhar” (self-reliant), as well as aspiring to become the third-largest economy in the world.
The first pillar of structural reforms shall comprise the inverted duty structure correction in specific sectors, resolve classification issues, and provide stability and predictability.
Also Read: 56th GST Council Meeting: Big Relief on Essential Goods
The second pillar of rate rationalisation has the motive to lower taxes on items of the common man and aspirational goods. It ensures an effective rate stability and facilitates the tax slabs.
The third pillar of ease of living will ease registration of startups, implement pre-filled returns, and ensure a more rapid refund process.
