The Union Finance Minister Arun Jaitley on Saturday has finalized the GST (Goods and Services Rates) for frequently used items, which includes footwear, gold, biscuits, textiles and apparels. Apparently, it was seen that these common items are kept in strange rates as the usage makes them special and the rates covered upon them might take a hit.
Starting from precious metals, Gold, Diamond, Silver and Gold Jewellery will be imposed 3 percent rates in GST Regime. Under the current taxation structure system, gold levies 1 percent VAT plus 1 percent excise duty, which is equivalent to 2 percent. After the implementation of GST, higher taxation rate would enhance the prices of gold and the major or large players would benefit with this while general people will have to pay out more.
Electronic appliances such as televisions, washing machines, air- conditioners and home appliances are kept under the 28 percent slab rate in GST Regime. It is one of the highest rates in GST Regime and Electronic item retailers think that the prices of white goods or electronic appliances will go up after the implementation of GST.
Blue star which is one of the largest makers of ACs pointed out that the new tax rates might not increase the prices of air- conditioners after the implementation of GST.
Coming to the poor protein source, biscuits will be imposed single 18 percent tax rate under GST Regime, which is quite surprising for everyone. The taxation rate is similar for all types of biscuits. This will severely impact the class of people who take their daily nutrition based on the biscuit made of glucose also making the poor class rely upon this source.
Now footwear sector categories are decided in two slab rates: First slab rate is 5 percent for footwear less than Rs 500 and the second slab rate is 18 percent for costing above Rs 500. The reaction of the industry to effective taxation rates is approximately 22-23 percent while many are surprised. Overall the GST rates on footwear industry will be positive.
In the case of textiles, there are different tax rates for different fibres. Silk and jute fibre will be imposed with zero percent tax rate, whereas cotton and all natural fibre will be levied at 5 percent tax rate. While the Man-made yarn will attract 18 percent tax rate whereas natural yarn will be imposed at 5 percent. Smartphones, groceries and luxury cars are announced at a lower tax rates as compared to the current taxation system.
The next GST Council Meeting is scheduled on 11th June for the revision of the tax rates. The GST council will compare the decided GST rates with the current tax rates; if there is any burden, they will look out the issue. In the meeting, they will also considers the e-way bill rules, accounts and records.
