Revised GST Rates Are Here!

By BankBazaar | July 28, 2018

The Government has revised the rates for the Goods and Services Tax (GST). Here’s all that you need to know.

GST Rates Are Finally Here!

The 28th GST Council meeting was held on the 21st of July, 2018. And the good news is that Goods and Service Tax (GST) on several items have been further reduced. The new rates will be applicable starting 27th July 2018.

Here’s what you need to know:

Further Reduction On Household Items

Tax on additional common goods has been reduced. Items such as refrigerators, washing machines, TV sets of up to 27 inches, vacuum cleaners, shavers and juicers have been further reduced by 10% from 28% to 18%.

Items such as fortified milk will be exempt from GST. Products like scents and toilet sprays which were taxed at 28% earlier will now be taxed at 18%. Products like handbags, wooden frames, glass statues and handcrafted lamps which were taxed at 18% will now be taxed at 12%. The GST rate on footwear of up to Rs. 1,000 has been cut to 5% from 18%. GST rate for leather items has been reduced from 28% to 18%. Items such as marbles and raw material used in brooms will be exempt from tax.

Exemption On Sanitary Napkin

The GST council decided to exempt sanitary napkin from the tax. The rate has been reduced from 12% to nil. The Government has requested manufacturers to transfer the entire benefit to the end user.

It’s good relief that the Goods and Services Tax (GST) council reduced the tax rates on a number of goods in the 28% slab. In addition, the council also introduced easier filing and provided the much-needed relief to small businesses as well.

More About GST Rates

GST has a 4-tier structure with rates ranging from 5% to 28%. Essentials have lower rates while luxury goods  are charged the highest. In the end, it’s more like a win-win for the consumers, at least in most cases.

No Tax Items

Keeping inflation in mind, items such as food grains, poultry, milk, fresh meat, curd, fish, flour, bread, cereals, salt, printed books, handloom items etc. aren’t taxed. So, the GST rate is zero for these items (hurray!). Note that almost half of the items in the Consumer Price Index fall in this category.

5%, 12%,18% And 28% Tax Items

Commonly used items or aam-aadmi essentials, such as tea and coffee, is taxed at just about 5%. This bracket also includes medicines, kerosene and frozen vegetables among others. Services such as air and rail transport are also placed under the 5% bracket.

Items under the 12% tax bracket include cheese, Ayurvedic medicines, mobile phones, frozen meat products, sewing machines, butter etc. Items such as mineral water, ice cream, cameras, notebooks, pastries, telecom services, steel products, refined sugar, financial services and more fall under the 18% slab.

Luxury items and services attract the highest tax rate of 28%.

Additional Reading: One Tax To Bind Them All – The GST Tax

Since the new GST rates are a breath of fresh air, why not give your finances a new lease of life? You could start by investing in a Fixed Deposit, or if you are a Credit Card lover, get a Cashback Credit Card that will help you save on your shopping. Remember, every penny counts!

All information including news articles and blogs published on this website are strictly for general information purpose only. BankBazaar does not provide any warranty about the authenticity and accuracy of such information. BankBazaar will not be held responsible for any loss and/or damage that arises or is incurred by use of such information. Rates and offers as may be applicable at the time of applying for a product may vary from that mentioned above. Please visit www.bankbazaar.com for the latest rates/offers.
Category: GST Tax

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