GST RATE RATIONALISATION AFTER ITEM-WISE ANALYSIS
While industry has demanded that rationalization, which will mean reworking of rtes. of various goods and services and also merging the four slabs on three, govt is no going to rush into any such exercise without a detailed analysis. A group of ministers had earlier looked at the issued but a decision on it has been pending for several months.
The broad assessment among industry players is that 12% and 18% slabs will be merged and a new 15-16% rate could emerge as the mid-rate, along with the 5% and 28% slab, given that several items will see an upward movement from the 12% slab, a political call needs to be taken. In fact, a few years ago some internal exercise had also been done in the finance ministry but covid had upset all the calculations. Whenever the rate changes take place, which could be several months away, govt wants to avoid a situation where it is accused of being anti-consumer, while also ensuring that the exercise is revenue neutral to the extent possible.
As a result, a very preliminary internal assessment is being done to see how a change in the rate of items in these segments would impact revenue flow, especially when the weighted average rate worked out to11.6% according to an analysis done by RBI a few years ago, against the proposed revenue neutral rate of 15-15.5 when GST was launched almost seven years ago.
But there is growing demand, and to an extent even realization within a section of govt, that the rates on several items, such as insurance or telecom services should not be 18%, but lower. Or, for that matter even cement should not be in the 28% bracket, given that it is used for construction, which has been a key demand of the industry. But before item-wise rates are discussion, finance ministers from the states and the Centre need to take a call to move ahead with rationalization.
GST Rates in India 2024 New updates
GST rates list is crucial for every Indian business and consumer to know. When the GST Council revises the Goods and Services Tax (GST) rates, it hits respective industries, trade bodies and end consumers, impacting the economy. Everyone tends to evaluate their position as a result of this Chage.
GST rates list highlights for the year 2024 all the recent Chages & updates of GST rates after the 54th GST Council meeting.
Meaning of GST Rates
Every business registered under GST must raise invoices with GST amounts charged on the supply value. These GST amounts are derived as a percentage value of taxable amounts. Such as percentage rate used is called the GST rate. For instance, GST of Rs. 1,200 charged on taxable value of Rs. 10,000 arrived by multiplying 12% GST rate with Rs. 10,000
Therefore, GST rate is a percentage rate of tax imposed on the sale of goods or services under the CGST, SGST and IGST Acts.
CGST GST rate and SGST GST rate would both behalf of IGST GST rate. In other words, the GST rate in CGST and SGST (For intrastate transactions) are approximately the same. Whereas the GST rate in the case of IGST (For interstate transactions) is approximately the sum total of CGST and SST rate
Types of GST Rates and GST Rate structure in India
The primary GST slabs for anu regular taxpayers are presently pegged at o%(nil-rated), 5%,12%,18% & 28 %. There is a new lesser-used GST rate such as 3% and 0.25%
Also, the composition taxable persons must pay GST at lower or nominal rates such as 1.5 or 5% or 6% on their turnover. There is a concept of TDS and TCS under GST as well, whose rates are 2% and 0.5% respectively (prior to 9th July 2024, it was 1%)
Further, the GST law levies cess in addition to the above GST rates on the sale of some items such as cigarettes, tobacco, aerated water, petrol, and motor vehicles, rates widely varying from 1% to 204%
The GST rate structure for some of the commonly used consumable products is given in the below table. For more items, type in the item you wish to know the GST rate of by visiting our HSN code & GST rates finder
LIST OF GST ITEMS @ 0%
Milk, Kajal, Eggs, Educational Services, Curd, Lassi, Health Services, Children's Drawing & Colouring Books, Unpacked Foodgrains, Unbranded Atta/Maida, Unpacked Paneer, Gur, Beasn, Unbranded Natural Honey, Fresh Vegetables, Salt, Prasad, Palmyra Jaggery, Phool Bhari Jhadoo etc.
LIST OF GST ITEMS @ 5%
Sugar, packed paneer, Tea, Coal, Edible Oils, Raisin, Domestic LPG, Roasted Coffee Beans, PDS Kerosene, Skimmed Milk Powder, Cashew Nuts, Footwear (<Rs.500), Milk Food for Babies, Apparels (< Rs.1000) Fabric, Coir Mats, Coffee (except instant), Mishti/Mithai (Indian Sweets), Life-saving drugs, Agar Batti & Matting & Floor covering spices.
LIST OF GST ITEMS @ 12%
Nuts or other parts of Plants, including pickle Murabba, Fruit Juice, Preparations of Vegetables, Fruits, Chutney, Jam, Jelly, Packed Coconut Water, Umbrella, Butter, Ghee, Processed food, Mobiles & Almonds.
LIST OF GST ITEMS @ 18%
Hair Oil, Capital Goods, Toothpaste, industrial Intermediaries, Soap, ice-cream, Pasta, Toiletries, Corn, Flakes, Soups, Printers & Computers.
LIST OF GST ITEMS @ 28%
Small cars, High-end motorcycles, Consumer durables such an AC and fridge, Luxury & sin items like BMWs, Cigarettes and aerated drinks.
