Following up from the meeting of the Goods and Services Tax council on May 18 and 19, Minister of State for Finance Santosh Gangwar said the stage is now set for the scheduled rollout of the GST Bill on July 1.
"After the meeting which took place in Srinagar last week, it is safe to say that GST will be levied across the country starting July 1," Gangwar told ANI.
Discussing the minutes of the meeting, Gangwar, while hailing the new tax regime to be an 'all-inclusive one', asserted that both vendors and consumers will benefit out of it.
"The bill has been drafted keeping collective development in mind. As of now, 32 taxes are being levied on commodities that are in circulation across the country. After the GST is incorporated, it will be a single replacement to these 32 taxes," he said.
On Friday, Union Finance Minister Arun Jaitley said the GST, which is to exempt the daily-use commodities from the levy, is going to be a more efficient and consumer-friendly taxation system.
"The four different rate slab for services are five percent, 12 percent, standard rate of 18 percent and luxury rate of 28 percent, out of which five percent mostly comprises of transport services," Jaitley said while addressing the media in Srinagar.
"GST in relation to the services sector was completely adopted in today’s meeting. Depending on the nature of service, there are various categorisations which have been made with a set of services, which have been exempted at present,"
"Other services are fitted into rates such as 5, 12, 18, and the luxury rate of 28 percent," he said while announcing that five percent rates comprise the transport services.
"Restaurants with a turn-over of 50 lakhs or below can go over with a composition of five percent," the finance minister said.
Daily-use items like sugar, tea, coffee (barring instant coffee), edible oil and life-saving drugs will attract the lowest tax rate of five percent, almost the same as the current incidence.
Milk and curd will continue to be exempted from taxation when the GST replaces current indirect taxes, while 'mithai' or sweets will attract five percent levy.
Common use products like hair oil, soaps and toothpaste will be charged a single national sales tax or GST of 18 percent instead of the present 22-24 percent tax incidence through a combination of central and state government levies.
The council has fitted all but six items in the 5, 12, 18 or 28 percent tax brackets.
Seven percent of the items fall under the exemption list while 14 percent have been put in the lowest tax bracket of 5 percent.
17 percent items are in 12 percent tax bracket, 43 percent in the 18 percent tax slab and only 19 percent of goods fall in the top tax bracket of 28 percent.
Cars, ACs, refrigerators and aerated drinks will be in the 28 percent bracket.
Over the peak rate, small cars will attract a 1 per cent cess, mid-sized cars will attract 3 percent and luxury cars 15 percent.
Image used for representational purposes only. Photograph: Reuters.