Guwahati: In a massive relief for consumers and businessmen and the biggest overhaul of GST slabs yet, tax rates of over 200 items, from chewing gum to chocolates, beauty products, wigs and wrist watches, were cut on Friday amid a crippling economic slowdown. Widely seen as one of the biggest concessions annou nced after the new indirect tax system took effect on July 1, it has been timed just ahead of the Gujarat polls, next month. During the BJP campaign in the state, Prime Minister Narendra Modi had hinted at a GST revamp to add ress concerns of people.
Finance minister Arun Jaitley said here after a meeting of the GST Coun cil that tax rates of 178 items have been slashed while keeping only 50 items, mostly demerit, sin and luxury goods, in the top 28% tax bracket. The new rates will come into effect from November 15.
"We could not take up the agenda of bringing real estate under GST in the meeting," said Mr Jaitley soon after the 23rd GST Council meeting.
"In the last few meetings, as a part of our effort to rationalise GST structure, council has been reviewing rates from time to time. When the rates were originally fixed by saddling previous taxes, the principal of equivalence had been applied. Therefore each item of good was specifically fit into VAT category," Mr Jaitley said.
"There was unanimity that in the 28% category there should be only sin and demerit goods. So, today the GST Council took a historic decision, that in the 28% slab there will be only 50 items and the remaining items have been brought down to 18 per cent," he said.