The GST council of India decided to impose GST on certain new items and elevate the existing cess rates on a few goods and services in its 47th meeting held in Chandigarh on Wednesday.
Revision Of GST Rates
Said Finance Minister Nirmala Sitharaman, that GST rates are being modified for existing goods and services and implied to certain new items to justify the tax criteria and to correct the “inverted duty structure”.
What’s Inverted Duty Structure?
Inverted duty structure on a good or service occurs when the final product is taxed less than the items of input. In such a scenario the GST is paid more on purchases and less at the time of sales, as per the Moneycontrol report. The government also has to repay the amount of inverted tax that has been credited because of the inverted duty structure. Now, in order to eradicate this problem, the Government is restructuring the duty structure on certain items.
Items That Are Going To Become Expensive After GST Rates Are Revised
- A five per cent GST rate is going to be imposed on pre-packed or unpacked food items such as dairy products, rice, wheat etc.
- Hotel rooms costing ₹1,000 or below were not being charged until now, but with GST revision they will be taxed under the 12 per cent GST slab.
- Hospital rooms other than ICU which were costing ₹5,000 or below were exempted until now, but now 5 per cent GST will be levied.
- The government will now charge an 18 per cent tax on the fees that banks charge from the customers at the time of Cheque book issuance.
- 18 per cent on “Hydrographic or similar charts of all kinds, including atlases, wall maps, topographical plans and globes.”
- GST will also be implied on a few postal services. However, the postal products which weigh under 10gms will not be taxed like “postcards, inland letters, book posts, and envelopes.”
- Now 18 per cent GST will be implied instead of 12 per cent on LED lights, lamps, and their electric accessories.
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Items That Are Going To Be More Affordable After GST Revision
- The GST council has decided to tank the GST rate from 18 per cent to five per cent on transporting goods and passengers through ropeways.
- After considering the surged fuel prices the council is going to charge 12 per cent instead of 18 per cent GST on Good carrier rental services.
- Orthopaedic products like splints and artificial or prosthetic body parts are going to be taxed under a five per cent GST slab now instead of 12 per cent.
- IGST on the defence items that are going to be imported by private entities of which the final user will defence forces is made tax free.
