The Federation of Karnataka Chambers of Commerce and Industry (FKCCI) greeted the new GST reforms, stating that they will be effective for the industry, trade sector, and consumers. GST Council member B.T. Manohar mentioned that the overall revision will benefit the common man. The request to reclassify goods under the Harmonised System of Nomenclature (HSN) has also been fulfilled.
The Union Government’s decision to eliminate the 12% GST slab and revise the tax structure will contribute to overall economic growth. The new GST framework has been streamlined into two main tax slabs of 5% and 18%, simplifying the previous system, which had four different slabs.
According to experts from the FKCCI, reducing the GST on essential daily-use items to 5% will lead to increased disposable income and greater domestic demand, especially during the festive season.
Additionally, the 18% GST on small cars, air-conditioners, televisions, and household appliances makes these products more affordable and broadens their market reach. FKCCI President MG Balakrishna noted that the reforms in GST are already positively influencing investor sentiment.
A positive response has been shown by them, and economists expect a potential boost of 100–120 basis points in GDP growth over the next 4–6 quarters, he cited.
The reforms regarding drones and simulators represent a crucial turning point for advanced industries. The significant reduction of GST to 5% on unmanned aircraft and the exemption of IGST for simulators directly lower costs for the defence and aviation sectors. This promotes broader adoption and supports domestic manufacturing.
Popcorn Subject to GST
People on social media quote their views on GST reforms, especially for the reduction in popcorn prices. As per the reforms, there is a 5% GST on the salted popcorn and 18% on the caramel popcorn. The relief has been cited by netizens asking multiplex associations not to raise the basic rates.
A member of the GST council explained the tax rates, stating that salted popcorn falls under the category of namkeen and salt confectionery, which is taxed at a rate of 5%. However, caramel popcorn does not fall into this category. Since popcorn is considered more of a snack that delights the palate, caramel popcorn is subject to a higher GST rate of 18%.
