On Saturday, the GST Council slashed down the tax rates on 23 goods and services from the top tax slab, making all these items much cheaper after the new rates become effective from January 1, 2019.
Pacing towards the promise of moving 99% items out of the 28% GST tax slab, the GST Council revised the tax levied on a total of 23 goods and services during the 31st meeting of Goods and Services Tax (GST) Council. These goods include movie tickets, TV and monitor screens and power banks, and exempted frozen and preserved vegetables on Saturday. Among the 23 items, 7 were from the 28% slab – leaving only 28 goods that are considered to be “luxuries”, are left in the highest tax bracket. Finance Minister Arun Jaitley informed that new reduced tax rates will be effective from January 1, 2019.
The goods and services that were brought down from 28% to 18% are pulleys, transmission shafts and cranks, gear boxes, rethreaded or used tyres, power banks of lithium ion batteries, digital cameras, video camera recorders and video game consoles. However, non-luxury and non-sin goods like auto-parts and cement are still left in the highest tax slabs due to the “high revenue implication”, but the government claims that “rate rationalisation is an ongoing process” – indicating further modifications in tax slabs in days to come.
Other than the top slab, GST on movie tickets costing up to Rs 100 cut to 12%, from 18%, tickets over Rs 100 to attract 18% GST, against 28% earlier – charged negligible or zero entertainment tax. Music books and vegetables (uncooked/cooked), frozen, branded and put in a unit container and preserved vegetables have been exempted from GST. Bank service for Basic Savings Bank Deposit account holders under the Jan Dhan Yojana will not attract GST. And air travel of pilgrims by non-scheduled/charter operations by the government, as well as renewable energy devices and parts for their manufacture will attract only 5% tax.