Select Your Location
Originally when the Goods and Service Tax Act, 2016 was implemented, GST rates structure was finalized and published by the GST Committee. Some commodities were kept in the high tax bracket but on scrutinizing, they found that these should be considered as necessities and not luxuries. In this article we described about GST Rates – Effective GST Rates in India.
This was considered a good sign of tax reform in India. The government has effectively made foods grains cheaper to improve the condition of the farmer. Few essential items such as cereals, food grains, and milk are exempted from GST. Most of the consumable products for common items have gone into 12% and 18 % GST bracket.
The government has shown its commitment to lower income group and farmers by either imposing a lower GST structure or by offering tax exemption. This is a good sign for the Indian economy.
Before applying for GST registration, it is advisable to check what the applicable tax rates for your business are and after successful registration what GST returns are required to be filed.
Table of Contents
After incorporating all these changes, the current slab of GST rates majorly consists of these rates (0%, 0.25%, 5%, 12%, 18% and 28%). Following are the list of few of such items included in respective tax slabs:
Products: – Milk, curd, food grains, raw foods, fresh meat, fish, chicken, eggs, natural honey, flour, fresh fruits and vegetables, bean, bread, Prasad, salt, bindi, sindoor, stamps, judicial papers, printed books, newspapers, bangles, handloom, plates and cups made of flowers, raw material used in brooms, etc.
Services: – chargeable services offered on basic savings bank deposit account under Pradhan Mantri Jan Dhan Yojana.
Cut and semi polished stones
Product: – Face mask, Sugar, tea, fish fillet, processed food item, skimmed milk powder, coffee, edible oil, branded paneer, sweets, bread, frozen vegetables, lifesaving drugs, coal, Domestic LPG, soyabean, groundnut, boats, fishing vehicles, natural cork, walking stick, marble rubble, coir mats, matting and floor covering, paste, handmade safety matches, electric vehicles, marine fuel, natural cork, curtains, etc.
Services:–All type of transport services (train, road, and air), leasing of aircrafts, tour operator services, Print media and space etc.
Product: – Frozen meat products, butter, ghee, cheese, all type of dry fruits in packaged form, animal fat, Bhutia, nankeen, sausage, fruit juices, Ayurvedic medicines, tooth powder, umbrella, colouring, books, picture books, candles, kitchen ware, toilet articles, handbags and shopping bags of jute and cotton specified parts of sewing machine, dry fruits in packaged form, bicycles, parts of specified agricultural, forestry, harvesting or threshing machinery, spectacles frames, etc.
Services: – Movie ticket less than 100 or equal to 100 rupees, hit fund services by foremen, food/drinks at restaurants without AC/ heating or liquor license.
Product:-Handwash sanitizer, preserved vegetables, note books, pastries and cakes, steel products, speakers, cameras, smartphones, footwear above 1000 rupees, biscuit, school bags, printers, helmets, hair cream, shampoos, sanitary ware and part thereof, wrist watches, clocks, physical exercise equipment, perfumes, glass of all kinds and parts thereof, storage water heaters, water cooler, washing machine, concrete mixer, telescope, binoculars, fire extinguishers, power banks, digital cameras and video camera recorders, etc.
Services: – Movie tickets over 100 rupees, outdoor catering, food/drinks at restaurants with AC/heating, etc.
Product:- Automobiles, motorcycles, dishwasher, liquid soaps, razors, wigs, false beards, ATM, vending machines, aerated water, motor cars, pianos, fax machines, monitor screen of more than 32 inches, tempered glass, aircraft for personal use etc.
Services: – 5-star hotels, race club betting, gambling, entertainment events.
Businessmen, tax professionals, economists, and the Indian media have endlessly hailed the proposed shift to the new tax regime and entire community collectively believes that it will dramatically improve the ease of doing business in India and will promote start-ups to join the Made in India mission. Still, the Indian economy is driven by the service provider. GST will significantly reduce tax evasion, will ensure easy compliance in terms of eliminating the need of Waybills, C form, F-form and other Local VAT and CST Forms, and it will eventually increase the overall GDP Growth.
Both central and state government achieved a major breakthrough in its quest to bring GST and we believe that GST will eliminate current dual control of tax assesses thrashed out between the state and the Centre. The Centre and state now agree to share tax revenue in 50:50 with assesses above Rs. 1.5 Cr annual turnover and below Rs. 1.5 Cr turnover in the financial year. The revenue sharing of state and Centre will be 90:10. Hence, the state will earn maximum revenue from small businesses.
Successful implementation of GST in all states of India is a big challenge whereas the Tax Commissioner and other revenue staff employed by Central and state governments will require extensive training and a skill development program. Much training is required for tax authorities to stop unnecessary penalty proceedings against businesses. If we do an analysis of the total penalty amount demanded vs. tax collection, the analysis says that 90% of the recovery order was either inappropriate or disposed of by the appellate authority at a later stage. This is one of the biggest challenges in the implementation of GST in India.
The GST council meeting is held regularly to improve the overall GST Rates in India for multiple goods.
Do you wish to register for GST? Or are you looking for a GST implementation advisory? Would you like to know about the GST’s impact on your industry? Please feel free to contact Enterslice, India’s leading online legal and tax advisory firm.
Read our article:
ITC restrictions for availing credit in accordance with Rule 36(4) of the CGST Rules
Ashish M. Shaji has done his graduation in law (BA. LLB) from CCS University. He has keen interests in doing extensive research and writing on legal subjects especially on corporate law. He is a creative thinker and has a great interest in exploring legal subjects.
In the recent past, India has seen burgeoning demand for internet and smartphones. The rapid ri...
The Securities and Exchange Board of India (SEBI), the capital markets regulator, has recommend...
The objective of the enactment of the Prevention of Money-laundering Act, 2002, i.e. PMLA (the...
Tax planning is a continuing effort and a management strategy for ensuring the minimization of...
On 18th May 2023, the Securities Exchange Board of India (SEBI) released a Consultation Paper o...
Infrastructure and real estate have been regarded as India's "sunshine sector" since the turn o...
On 22nd May 2023, the Central Board of Direct Taxes (CBDT) issued a new circular under secti...
Anyone can have different sources of income. With globalization and the opening up of economies...
The Reserve Bank of India (RBI) is crucial in regulating NBFC, including branch openings and cl...
In India, Non-Banking Financial Companies are subject to certain restrictions from taking publi...
Are you human?: 8 + 4 =
Easy Payment Options Available No Spam. No Sharing. 100% Confidentiality
Under Section 61 of the CGST Act 2017, a proper officer can scrutinize a return and related particulars furnished b...
02 May, 2022
The Central Board of Indirect Taxes and Customs (i.e., CBIC) has recently announced an increase in the goods and se...
29 Nov, 2021
Red Herring Top 100 Asia enlists outstanding entrepreneurs and promising companies. It selects the award winners from approximately 2000 privately financed companies each year in the Asia. Since 1996, Red Herring has kept tabs on these up-and-comers. Red Herring editors were among the first to recognize that companies such as Google, Facebook, Kakao, Alibaba, Twitter, Rakuten, Salesforce.com, Xiaomi and YouTube would change the way we live and work.
Researchers have found out that organization using new technologies in their accounting and tax have better productivity as compared to those using the traditional methods. Complying with the recent technological trends in the accounting industry, Enterslice was formed to focus on the emerging start up companies and bring innovation in their traditional Chartered Accountants & Legal profession services, disrupt traditional Chartered Accountants practice mechanism & Lawyers.
Stay updated with all the latest legal updates. Just enter your email address and subscribe for free!
Chat on Whatsapp
Hey I'm Suman. Let's Talk!