With Christmas approaching, The Goods and Services Tax (GST) council on Saturday slashed the rates of seven items from the 28% tax slab, giving a Christmas Gift to common man. The 31st GST council meeting was chaired by Finance Minister, Arun Jaitley, along with other members of the council.
The main agenda of the meeting was to slash the tax rates of 23 goods and services of common consumptions so that basic commodities gets readily available for commoners at the most reasonable price. Mr. Arun Jaitley said this tax cut will have an annual revenue implication of Rs. 5,500 crore.
Prime Minister Narender Modi, who had earlier promised commoners to retain only the luxury items and sin goods in the tax slab of 28% said that with this decision of his only 28 goods will be left in the highest 28% tax bracket. Although in order to achieve the target for state revenue, cement and automobile components will remain in the 28% tax slab.
The items moved from 28% to 18 % included a computer monitor, power bank, LED TV up to 32 inches, pulleys and transmission shafts used in farming, retreaded tires, digital cameras, video camera recorders, and video consoles. Parts of carriages for disabled people was slashed from 28% to 5%. Movie tickets up to Rs. 100 has been bought under 12% slab from 18%. The tickets above Rs. 100, will now charge 18% GST. Services of banks for basic accounts and the Pradhan Mantri Jan-Dhan Yojana (PMJDY) were exempted from tax slabs. This will benefit the common man in vivid ways. Now maximum items will be available under lower taxes slabs. Also, the tax rate of third-party motor insurance has been slashed down from 18% to 12 %.
The reduced rates will come into effect from 1 January 2019.
The tax slab now attracts maximum goods below 28% slab, in the interest of the common man. Only luxury items and sin goods remain in the highest tax slab which is consumed by the economically stronger segment of the society, with only one exception i.e. cement. It is very evident from the 31st GST council meeting results that the common man will be highly benefitted with the slashed rates.