GST Council to discuss rates on services today, finalise list of exempted items

May 19, 2017

New Delhi, May 19: The all-powerful Goods and Services Tax (GST) Council members will meet again meet in Srinagar on Friday take up the exemption of essential services.

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Union Finance Minister Arun Jaitley expressed hope to finalise list of exempted items today and will also discuss rate of tax on gold and bidi.

Chaired by Jaitley, this is the first time that such an important national policy-making meet is being held in Jammu and Kashmir.

The GST Council yesterday finalised tax rates for bulk of the items. Foodgrains and common-use products like hair oil, soaps and toothpaste as also electricity will cost less from July 1 when the GST is scheduled to be rolled.

While the Council fitted all but six items in 5, 12, 18 or 28 percent tax brackets, cars will attract the top rate as also a cess in the range of 1 to 15 percent on top of it.

Small cars will be charged 1 percent cess on top of 28 percent tax, mid-sized and luxury cars will attract cess of 15 percent on top of the peak rate.

Aerated drinks too have been put in the 28 percent bracket along with a cess of 12 percent, but the rates for bidis along with gold, footwear, bidi, biscuits and agriculture equipments would be decided later.

While meat, fresh vegetables, honey, jaggery, prasadam, kumkum, bindi, pappad and contraceptives have been exempt from GST levy, items like pizza bread, sevaiya, condensed milk, frozen vegetables will attract 5 percent levy, as per the items list put on CBEC website late in night.

The Goods and Services Tax (GST) on coal has been brought down to 5 percent from the current tax incidence of 11.69 percent, thereby making electricity generation cheaper.

Common use products like hair oil, soaps and toothpaste will be charged with a single national sales tax or GST of 18 percent instead of present 22-24 percent tax incidence through a combination of central and state government levies.

ACs and refrigerators will fall in the 28 percent tax slab while life-saving drugs have been kept at 5 percent rate.

All capital goods and all industrial intermediaries would?attract 18 percent tax instead of 28 percent.

Milk and curd will continue to be exempt from taxation? when the GST replaced current indirect taxes. 'Mithai' or sweets will attract 5 percent levy.

Daily-use items like sugar, tea, coffee (barring instant coffee) and edible oil will attract the lowest tax rate of 5 percent, almost the same as current incidence.

While frozen meat will attract a GST of 12 percent, Ayurvedic or homeopathy medicines, agarbatti, umbrella, electric vehicles and mobile phone manufacturing will be taxed at 12 percent.

Pastries and cakes, pasta, ice cream and soups, instant food mixes, betel nut, vinegar and sharbat will attract a 18 percent tax, while the highest tax of 28 percent will be levied on chewing gum, chocolates, custard powder and waffles containing chocolate.

The two-day meeting is being attended by around 150 dignitaries, including finance ministers and finance secretaries of all the states.

The GST will be a national sales tax that will be levied on consumption of goods or use of services. It will replace 16 current levies -- seven central taxes like excise duty and service tax and nine state taxes like VAT and entertainment tax -- thereby creating India as one market with one tax rate.

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News Network
April 26,2024

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Voting has begun in 88 constituencies across 13 states and Union Territories amid a furious row between the Congress and the BJP over manifesto and inheritance tax. Election will be held on all seats of Kerala, a chunk of Rajasthan and UP.

Key points

Elections for the second phase will be held for 20 seats of Kerala, 14 seats in Karnataka, 13 in Rajasthan, eight each in Uttar Pradesh and Maharashtra, seven in Madhya Pradesh, five each in Assam and Bihar, three each in Bengal and Chhattisgarh and one each in Jammu and Kashmir, Manipur and Tripura.

Earlier, 89 constituencies were expected to vote in this phase. But polling in Betul, Madhya Pradesh, was rescheduled after the death of a candidate from Mayawati's Bahujan Samaj Party. Betul will now vote in the third phase, due on May 7.

Key candidates for this round include the BJP's Union minister Rajeev Chandrashekhar  -- up against Congress' Shashi Tharoor from Thiruvananthapuram; actors Hema Malini, and Arun Govil from 1980s iconic serial Ramayan, senior BJP leader Tejasvi Surya and Lok Sabha Speaker Om Birla,  Congress' Rahul Gandhi, KC Venugopal, Bhupesh Baghel. and Ashok Gehlot's son Vaibhav Gehlot.

For both BJP and the Opposition, the most crucial states in this phase will be Karnataka and Kerala. Karnataka is the only BJP bastion in the south, where the Congress won in the last assembly election. The party is hoping to do well amid concerns about delimitation and the disadvantage southern states could face after it.

Further south, the BJP is trying to break into the bipolar politics of Kerala. The party is hoping to open its account in the state having fielded Union ministers Rajiv Chandrasekhar and V. Muraleedharan. In Wayanand, a Congress bastion for over 20 years, it has fielded its state unit president K Surendran against Rahul Gandhi.

For the Opposition, Kerala is a big shining hope. Even though the Left and the Congress are competing against each other in the southern state, victory by either will add to the tally of the Opposition bloc INDIA. Kerala is one of the few states that have never sent a BJP member to parliament.

With north, west and northeast India saturated, the BJP is hoping to expand in the south and east in their quest for 370 seats. The party had won 303 seats in 2019, a majority of them from the Hindi heartland and bastions new and old, including Gujarat and the northeast.

The Congress, though, has claimed it would post a much better performance compared to 2019. After the first phase of the election, their claims have got louder, especially in Rajasthan and western Uttar Pradesh. Rashtriya Janata Dal chief Tejashwi Yadav has claimed INDIA will win all five seats in Bihar.  

The election is being held amid a bitter face-off between the Congress and the BJP. The row was sparked by Prime Minister Narendra Modi's comment that the Congress, if voted to power, will redistribute the personal wealth of people among "infiltrators" and won't even spare the mangalsutras of women. The Congress has questioned if the people had to fear for their wealth and mangalsutras in 55 years of the party's rule and accused the BJP of sidestepping issues that matter.

The next phase of election is due on May 7. The counting of votes will be held on June 4 – three days after the seventh and last phase of election on June 1.

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News Network
April 25,2024

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The Election Commission of India on Thursday announced that it had taken cognisance of violations to the Model Code of Conduct by both Prime Minister Narendra Modi and Congress leader Rahul Gandhi.

While Modi has indulged in a diatribe against Muslims, without naming them, using terms like 'infiltrators' and 'those with more children', Rahul has been accused of making a false claim about 'rise in poverty'.

Both the BJP and INC have raised allegations of causing hatred and divisions based on caste, religion, language, and community, ANI reported.

While the EC had initially refused to comment on Modi's speeches, sources had told PTI that the commission was 'looking into' the remarks made by the BJP leader.

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News Network
April 20,2024

Union Finance Minister Nirmala Sitharaman, on Friday, said that the Bharatiya Janata Party (BJP) plans to reintroduce electoral bonds in some capacity following extensive consultations with all stakeholders, should it come back to power in the 2024 general elections, according to a report in the Hindustan Times (HT).

HT cited Nirmala Sitharam as saying, “We still have to do a lot of consultation with stakeholders and see what is it that we have to do to make or bring in a framework which will be acceptable to all, primarily retain the level of transparency and completely remove the possibility of black money entering into this.”

However, the Centre has not yet decided whether to seek a review of the ruling made by the Supreme Court (SC), she said.

She further added, “What the scheme, which has been just thrown out by the Supreme Court, brought in was transparency. What prevailed earlier was just free-for-all.”

Launched in 2018, electoral bonds were accessible for acquisition at any State Bank of India (SBI) branch. Contributions made through this programme by corporations and even foreign entities via Indian subsidiaries received full tax exemption, while the identities of the donors remained confidential, safeguarded by both the bank and the recipient political parties.

On February 15, a five-judge Constitution Bench struck down the scheme, deeming it ‘unconstitutional’ due to its complete anonymisation of contributions to political parties. Additionally, the Bench stated that the articulated objectives of curbing black money or illegal election financing did not warrant disproportionately infringing upon voters’ right to information.

FM Sitharaman said, some aspects of the scheme need improvement and they will be brought back following consultations.

She also lashed out at the Opposition’s claims that the BJP disregarded criminal charges against leaders who switched from other parties to join the ruling party.

The HT quoted her as saying, “The BJP can’t sit here and say, you come to my party today, and the case will be closed tomorrow. The case has to go through the courts that have to take a call; they will not just say, “Oh, he’s come to your party, close the case.” Doesn’t happen that way. So is this washing machine a term they want to use for the courts?”

She further said that the Union government plans to simplify the process of taxation and make it easy for investments to come through into the country.

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