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GST Rates Revised: Check the products that will attract GST now

by Rishika Choudhury

Date & Time: Jun 30, 2022 4:00 PM

Read Time: 3 minute

In its 47th meeting in Chandigarh, the GST Council decided to include more items in its ambit that could affect the common man's pocket. The GST Council has decided to impose a tax on pre-packaged food items. The decisions by the GST Council on exemptions and correction of inversion will come into effect from July 18.

Check the list of products that will attract GST now:

Products to attract 5 per cent GST if they are labelled food items include, pre-packed and labelled meat (except frozen), fish, curd, honey, dried leguminous vegetable, dried makhana, wheat and other cereals, wheat or meslin flour, jaggery and puffed rice

While compost made from coir pith and organic manure would not be exempt from GST. Additionally, a GST of 18% will be applied to the fee that banks charge for issuing checks (loose or in book form). Atlases and other maps and charts will also be subject to a 12% charge. Unpackaged, unlabeled, and unbranded goods will continue to be exempt from the GST.

A 12 per cent tax on hotel rooms below Rs 1,000 per day will be levied, as against a tax exemption currently. The GST Council also suggested a correction in the inverted duty structure for items, including edible oil, coal, LED lamps, printing/drawing ink, finished leather and solar water heater.

Important to boost the weighted average GST rate

GST rate rationalisation is important to boost the weighted average GST rate that has fallen to 11.6 per cent against 14.4 per cent at the time of launch.

The controversial topic of extending the compensation granted to states for revenue lost from their taxes, such as sales tax (VAT) being merged into a national GST beyond June 2022 and a 28% tax on casinos, online gaming, and horse racing, is likely to be discussed by the Council.

Where GST Increased

GST exemption on services extended by RBI, Irdai, Sebi, FSSAI and GST has also be withdrawn. GST on petroleum/ coalbed methane has been increased from 5 per cent to 12 per cent, that on e-waste has also been raised from 5 per cent to 18 per cent. The tax on scientific and technical instruments supplied to public funded research institutes has been raised from 5 per cent to the “applicable rate".

Where GST Decreased

The Council has reduced GST from 12 per cent to 5 per cent on ostomy appliances (including pouch or flange, barrier cream, sleeves, irrigator kit, micro-pore tapes, stoma adhesive paste, belt). It has also reduced the rate from 12 per cent to 5 per cent on orthopedic appliance (splints and other fracture appliances); artificial parts of the body; other appliances which are worn or carried, or implanted in the body, to compensate for a defect or disability; and intraocular lens.

GST Registration Waiver for benefit of unorganised sector

In a move that will benefit persons in the unorganised sector, the GST Council also decided to waive mandatory registration for small entities selling their products online. The exemption will be for those having an annual turnover of up to Rs 20 lakh and those not making any inter-state taxable supply. The changes will be effective from January 1, 2023.

Also Read: Economy to bring down prices, Modi government aims to lower taxes on edible oils

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