The tax slab reduced from 5% to 18%
Late on Wednesday, September 3, the GST Council adopted a two-tier rate structure consisting of 5% and 18%, which will take effect on September 22 and replace the previous slabs of 12% and 28%.
This action will lower the cost of a number of necessities, including cars, air conditioners, shampoo, and soap. At a press briefing, Finance Minister Nirmala Sitharaman said the decision was made at the 56th meeting of the GST Council.
GST-free key items
Numerous food items, such as milk, Indian breads, and pizza bread, will be exempt from GST, Sitharaman continued. Policies for life and health insurance will likewise be tax-exempt.
All compact autos now only pay 18% GST instead than 28%. Small cars are defined as gasoline, LPG, or CNG vehicles with an engine displacement of up to 1,200 cc and a length of up to 4,000 mm, as well as diesel vehicles with an engine displacement of up to 1,500 cc and a length of up to 4,000 mm for the purposes of GST.
Although this tax sector is not yet formally constituted, luxury goods and tobacco products will be subject to a 40% GST. Beginning on September 22 or the first day of Navratri, the two-tier prices will be in place.
By raising taxes, these reforms aim to deter the use of dangerous products like tobacco and lower the cost of goods for the average person.
Tobacco and gutkha should be provided at the 5% GST rate, according to the Congress Party: Sitharaman
Nirmala Sitharaman, the Union Finance Minister, states: “Is the Congress Party calling for a five percent tax on gutkha and tobacco? 5% is what the Congress Party wants us to offer. During their time, the Congress Party believed that the GST could not be implemented. Under Modi ji’s leadership, we have put second-generation reforms into place and are continuing to do so to help people with their daily problems.
The GST rate for gambling, horse racing, lotteries, casinos, and betting is 40%.
The GST rate of 40% will be applied to any specified actionable claims, such as gambling, horse racing, lottery, betting, casinos, and online money gaming. 40% GST will be applied to entrance to athletic events such as the Indian Premier League; however, this rate will not be applicable to admission to recognized sporting events.
Admission to other athletic activities, such as sanctioned athletic events, is still free if the cost of the ticket is less than Rs. 500. If the cost exceeds Rs. 500, the usual 18% tax rate is still applied.
