GST: Cars, mobile phones, clothes, shoes now, how much GST will take, the full list is here

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A major change has been made in the country’s indirect tax collection system in the 56th meeting of the GST Council held in New Delhi on 3 September under the chairmanship of Union Finance Minister Nirmala Sitharaman. Taking a big decision, the GST Council has made GST easy. Now there will be only two slabs instead of four tax slabs. On the demand for middle class for a long time, the council has abolished 12% and 28% tax rates. Now only 5% and 18% rates will be applied.

The council has removed many essential commodities and services from a slab of 12% and 28% and placed it in a slab of 5% and 18%. Due to this, many things have become cheap and many things expensive. Let’s see what has become cheap and what has become expensive. The new GST rates will be implemented from September 22. These changes will directly affect the domestic budget. Let’s see what has become cheap and what has become expensive?

First things on which GST has been reduced.

1. Hellthcare and Education

  • Tax has been reduced on life saving medicines, health related products and some medical equipment. GST has been reduced from 12% or 18% to 5% or O.
  • GST on educational services and goods such as books and learning AIDS has been reduced from 5% and 12% to zero or 5%.

2. Agriculture and fertilizer

  • The tax on fertilizer has been reduced from 12%/18% to 5%.
  • GST has been reduced from 12% to 5% on seeds and crop nutrients like agriculture like agriculture.

3. Food and everyday needs

  • Milk Products: The UHT (ultra-high temperature) milk will now be completely tax-free, the first was 5%, while the tax on condensed milk, butter, ghee, cheese and cheese has been reduced from 12% to 5% or in some cases.
  • Essential Foods: The tax on malt, starch, pasta, cornflex, biscuits, even chocolate and cocoa products has been reduced from 12% or 8% to 5%.
  • Dry and dry fruits: Almonds, pistachios, hedge, cashews and dates will now be levied only 5%, the first was 12%.
  • Chinese and Confectionery: Tax on refined sugar, sugar syrup and sweets like toffee and candy has been reduced to 5%.
  • Other packaged foods: Vegetable oil, animal fats, edible spreads, sausages, meat products, fish products and malt extract based packaged foods have been brought into 5% slab. GST has been reduced from 18% to 5% on Namkeen, Bhujia, Mixter, Chabena and similarly prepared products (except roasted gram), pack and label.
  • Water: The tax on natural or artificial mineral water and areted water (without sugar, sweetener or flavor) has been reduced from 18% to 5%.

Consumer goods

  • Electronics: GST has been reduced from 28% to 18% on early and more used equipment.
  • Shoes and clothes: GST has been reduced from 12% to 5%.
  • Paper Sector: GST reduced from 12% on some grades.
  • Hair oil, shampoo, dental floss, toothpaste reduced from 18% to 5%.

Vehicle

  • Electric and hydrogen cars will now be charged 5% GST instead of 12%.
  • Tractor will be replaced by 5% GST instead of 12%, but except for road tractors for semi-trailers with engine capacity more than 1800 cc.
  • GST on road tractors has been reduced from 28% to 18% for semi-tralers with engine capacity of 1800 cc.
  • Motor vehicle for transporting ten or more persons including driver (except buses for use in public transport, special
  • In the form of biofuels, which is already 18%), GST has been reduced from 28% to 18%.

Other sector

  • Renewable Energy Products: Reduced from 12% to 5%
  • Construction material: Necessary raw materials reduced from 12% to 5%
  • Sports and Toys: Reduced from 12% to 5%
  • Leather, wood and handicrafts: 5% brought to slabs

Overall, from grocery, food, shoes, clothes to renewable energy has now become cheaper. This will provide relief to common homes, small businesses and middle classes.

What will be expensive

Relief has been given on many things, but some goods and services will still be under the scope of more tax.

1. Energy and Fuel

Coal, which was earlier taxed 5%, will now be taxed at 18%. This will increase the cost of coal based industries.

2. Sin products

The existing high GST rates and compensation cess on pan masala, gutkha, cigarette, chewing tobacco, yolk, raw tobacco and bidi will continue until the outstanding loans related to the cess are fulfilled. Now the evaluation of these products will be on the retail cell price (RSP) instead of the price of transactions, which will make the rules and stringent. All goods (eg areed water) which have been mixed with sugar, sweetener or flavor have been increased from 28% to 40%.

3. Luxury and premium goods

There will be a new 40% slab on premium and luxury goods. This means that there will be no tax relief on cigarettes, premium liquor and high-end cars. Imported bulletproof luxury sedan cars will be exempted only in special cases, such as vehicles called by the President’s Secretariat.

4. Services

Restaurants running in specified prelims (designated places) will no longer be able to choose the option of ITC (input tax credit) with 18% tax, that is, this path to save tax has been closed. New assessment rules will apply to some lottery and middleman services, which will either remain the same or increase the tax burden on them.

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