State ministers' panel approves Centre's two-slab GST structure
The Group of Ministers has approved a move to a simplified two-slab structure of 5% and 18%, impacting various goods and services.
The Group of Ministers has approved a move to a simplified two-slab structure of 5% and 18%, impacting various goods and services.
The Group of Ministers has approved a move to a simplified two-slab structure of 5% and 18%, impacting various goods and services.
New Delhi: The Group of Ministers (GoM), consisting of state ministers, on Thursday approved the Centre's proposal to rationalise GST rates, moving to a simplified two-slab structure of 5 per cent and 18 per cent.
Bihar Deputy Chief Minister and convenor of rate rationalisation Samrat Choudhary said the six-member state ministerial panel has also accepted the proposal of removing the 12 and 28 per cent slabs. "Both the proposals of the Centre have been accepted by the GoM on rate rationalisation," Choudhary told reporters after the meeting of the panel.
Uttar Pradesh Finance Minister Suresh Kumar Khanna said the Centre's proposal also includes levying 40 per cent tax on ultra luxury and sin goods.
West Bengal Finance Minister Chandrima Bhattacharya said her state has proposed a levy on top of the 40 per cent GST rate so that the current tax incidence on ultra luxury goods, like cars, and sin goods, is maintained. Bhattacharya said the Centre's proposal did not mention the revenue loss that would accrue to the Centre and states after the implementation of the new GST slabs.
At present, Goods and Services Tax is a 4-tier structure of 5, 12, 18 and 28 per cent. While food items are either taxed at 0 or 5 per cent, luxury and sin goods are taxed at 28 per cent. On top of the 28 per cent slab, cess at varied rates is levied on demerit and luxury goods, like cars.