GST Council could trim list of items in highest tax slab next
Following Friday’s revision of GST rates, the federal tax body said it was willing to relook the 28% tax slab – the highest slab under the goods and services tax – once revenue stabilises.business Updated: Oct 09, 2017 11:43 IST
Federal tax body, the Goods and Services (GST) Council, will consider trimming the list of products in the highest tax bracket of 28% as revenue from the new indirect tax regime stabilises, members of the Council said on Saturday.
Captain Abhimanyu, finance minister of Haryana, said on the sidelines of a conference on GST organised here by industry lobby PHD Chamber of Commerce and Industry that fitment of goods and services in various GST slabs was done such that they fall in the slab closest to the then prevailing effective tax rate. “This could be re-looked as revenue stabilises,” said Abhimanyu.
Minister of state for finance Shiv Pratap Shukla, a member of the Council who also attended the conference said the Council has already taken steps to rationalise tax rates and that the trend would continue. “The 28% slab would fall as per genuine and legitimate aspirations of the people in general and industry in particular”, said the minister.
Mahender Singh, Member (GST), in Central Board of Excise and Customs, who also spoke at the conference, said that the highest tax slab of 28% was reviewed by the Council. “The 28% tax rate may eventually be levied only on luxury and sin goods. During the next few meetings, I’m sure you’ll hear something positive about it,” said Singh.
Items in the 28% slab include chocolates (with and without cocoa), extract or concentrate of coffee, certain non-alcoholic beverages, sweetened aerated drinks, tobacco other than bidi, marble, granite, wall paper, certain types of cement, paints, varnishes, perfumes, beauty and skin care products and after shave lotions. A few services such as access to entertainment events, movies and accommodation in five star and above rated hotels of tariff Rs 7,500 or above also attract 28% tax.
Captain Abhimanyu said at the conference that when GST was rolled out on 1 July, policy makers knew it was a baby step and that one had to respond swiftly to the problems that were bound to arise in a massive nationwide indirect tax overhaul. “I am glad that three months since, the nation has leapfrogged many miles,” Abhimanyu said.
The Council on Friday announced a series of steps to ease the compliance burden of small and medium enterprises and exporters including steps to address exporters’ liquidity problems. The relaxation in rules are part of efforts to support growth in these two segments that are key to economic growth and job creation. Shiv Pratap Shukla urged people to give the government nine months to remove all glitches in the GST system.
First Published: Oct 07, 2017 23:32 IST