SIMPLY PUT: How will the GST council’s tax changes affect family budgets?

Advertisement
SIMPLY PUT: How will the GST council’s tax changes affect family budgets?
The Goods and Services Tax (GST) Council held its 47th meeting last week and announced a slew of changes. It decided to bring more food items and services under its ambit, which might further strain already burdened family budgets.
Advertisement

SIMPLY PUT: How will the GST council’s tax changes affect family budgets?
GST changes might further strain already burdened family budgetsTenor

What is GST?

The Goods and Services Tax is a uniform indirect tax that replaced almost all central taxes. It came into effect in July 2017 and subsumed more than 13 central and state-level taxes.


Why the revisions in GST?

GST rates were being revised to rationalise tax on certain goods and services to correct an inverted duty structure, said Union Finance Minister Nirmala Sitharaman.
Advertisement



Revised GST brings more food items under the tax slab

Sitharaman chaired the meeting that included representatives of all states and UTs. A raft of decisions were taken at the meeting, including the withdrawal of the tax exemption on pre-packed and labelled retail items.

Food items such as curd, lassi, puffed rice, buttermilk, meat (except frozen), fish, paneer, honey, dried leguminous vegetables, dried makhana, wheat and other cereals, wheat or meslin flour, jaggery, all goods and organic manure and coir pith compost will now attract a 5% tax from July 18.

One of the reasons why unlabelled commodities were brought under the tax bracket was because some companies were seen to be misusing the provision of exempting unlabelled food items.

Advertisement
The council also announced an 18% GST on fees charged by banks for the issue of cheques (loose or in book form). Maps and charts including atlases will attract a 12% levy.

The council deferred a decision on levying a 28% tax on casinos, online gaming, horse racing and lottery, pending more consultations with stakeholders.

SIMPLY PUT: How will the GST council’s tax changes affect family budgets?
Revised GST brings more food items under the tax slabBI India

Adding to the family bills

The new 5% tax on pre-packaged and unpacked essential food items like rice, wheat is expected to add to inflationary concerns, leading to price hikes.

Non-ICU hospital rooms costing ₹5,000 a day will now attract 5% GST. Hotel rooms costing under ₹1,000 a day will be brought under the 12% tax slab.
Advertisement

Kitchenware knives, blades, spoons, forks and ladles have also been moved to the 18% tax slab, up from 12% earlier.

What will be cheaper?

There are a few commodities and services that will get cheaper after the recent GST revision.

Tax rates on transport of goods and passengers via ropeways; and orthopaedic appliances like splints and artificial body parts have been reduced to 5%.

Here a short video-

SIMPLY PUT: How will the GST council’s tax changes affect family budgets?
<b>Simply put: How will the GST council’s tax changes affect family budgets?</b>BI India

Advertisement
{{}}