The most awaited bill that is the key player in Indian Economy, GST is all set to take place on July 1 nationwide. We are eager to what is costlier and what will empty your pocket fast.
Here we go:
|Slabs||New GST Rates||Current Rates||Products|
|1||5%||Upto 9%||Edible oil, tea, coffee, spices|
|2||12%||9%-15%||Computers, Processed Food|
|3||18%||15%-21%||Soaps, Shampoos, Hair oil, Shaving Creams etc.
Services like dining in restaurants, booking air/railways tickets, DTH and mobile services
|4||28%||21%||Luxury Goods (Additional cess of upto 15 % may be put on luxury cars, tobacco, aerated drinks)|
This table shows the earlier price and the price after 1st July when GST will be applicable.
Which things will be cheaper:
1. Fans, air coolers, lighting water heaters, LED TVs, mobile phones and other electronic items
2. FMCG goods such as shampoos, over-the-counter drugs, processed foods, chocolates etc
3. Pharma products
4. Readymade clothes, including branded apparel
5. Movie tickets (due to reduction in entertainment tax)
6. Two-wheelers, entry-level cars and SUVs
7. Cement, paint and other construction material
8. Solar panels, Point of Sale (PoS) machines and fingerprint scanners
Why: At current situation, the consumer is paying 25%-26% more due to VAT (value added tax) and excise duty than the cost of production for consumer goods. New rate will be 18% due to GST and they are expected to become cheaper.
Which things will be costlier:
- Hotel and restaurant bills
- Mobile bills and internet packs
- Jewellery and high-end accessories
- Rail transportation, air travel and rent-a-cab services
- DTH, cable TV and courier services
- Luxury cars
- Aerated drinks
- Insurance Premiums
- Online Shopping (however, this is expected to be balanced by lower costs of logistics and smoother inter-state transport because of a uniform tax rate)
Why: Earlier tax was 15% for above service which will be costlier in GST i.e. 18%. Some of the essential services which are affected due to GST is ambulance services, cultural activities, sports events and certain pilgrimages.
Still, there are many things that are not listed in the proposed tax slabs and Central Government is engaged to cover almost all the commodities and services that are about 5,000 in numbers, under the tax legislation.
Finance Minister Arun Jaitley hinted the changes and updates that could be announced in April 2017.