The 31st GST Council Meeting held on 22nd December 2018 played a significant role in revising the GST tax slabs of various goods and services post the implementation of this new tax regime.
Tax slabs of GST
Currently, all products and services in this country fall under the tax slabs of 5%, 12%, 18%, and 28%. Only the GST rate on gold is 3%.
GST has many effects on gold jewellery as well as on diamonds, precious stones, and synthetic and reconstructed precious or semi-precious stones come with a 0.25% rate.
Below are the gods and services falling under the respective tax slabs:
28%
Products –
Premium cars and motorbikes, aerated drinks, cigarettes, small luxury cars, and consumer durables (refrigerators, air conditioners, etc.)
Services –
Food/drinks/accommodation in 5-star hotels, gambling, race club, entertainment events, and amusement parks.
A GST identification number is mandatory for businesses offering these products and services.
18%
Some of the products and services added to this tax slab. Tax rate of other items in this slab remains unchanged like the GST rate on gold.
Products –
- Electronics and electrical goods
Power banks with lithium-ion batteries, TVs up to 32-inches, monitors up to 17-inches, electrical filaments or discharge lamps, gaming consoles, set-top box, UPSs, transformers, and single-function printers, winding wires, coaxial cables, and optical fibre cables.
- Automobiles
Used or retreaded pneumatic rubber tyres, rear tractor wheel rim, tractor centre housing, tractor housing transmission, tractor support front axle, rear tractor tyres, and rear tractor tyre tubes.
- Hardware
Ball bearings, roller bearings, aluminium foil, salt-glazed stoneware pipes, precast concrete pipes, and plastic tarpaulin.
- Stationery
Hand-held measuring tools, staplers, sharpeners, school bags, and satchels.
- Others
Swimming pools, paddling pools, bamboo furniture, weighing machine (non-electronic), headgear, handbags/shopping bags (other than basket or wicker), dental wax, kajal pencil sticks, and sports goods.
Services –
Movie tickets worth more than Rs. 100, circus, Indian classical, folk, theatre, drama, rent (Rs. 2,500 to Rs. 5,000), outdoor catering, food/drinks at restaurants with AC/heating and liquor license, party arrangement, supply of food and shamiyana are charged at 18%.
Loans are also taxed at 18%. However, the rate of interest remains unchanged. Bajaj Finserv is an NBFC that provides Business Loans at attractive interest rates.
The GST rate of existing items in this tax slab remains unchanged like the GST rate on gold.
12%
Products and services added to this tax slab.
Products –
- Food
Mixed condiments and mixed dressings, mayonnaise and salad dressings, ketchup, mustard sauce, spearmint oil, mentha piperita oil, dementholised oil, fractionated/de-terpenated mentha oil, peppermint, menthol and menthol crystals, jam, jelly, murabba, nuts, and pickle.
- Cork
Agglomerated cork, products made from natural cork, and debagged/roughly squared cork.
- Lens and glasses
Corrective spectacles, intraocular lens, and glasses for corrective spectacles.
Services –
Movie tickets less than or equal to Rs. 100, construction of property for sale, rent (Rs. 1,000 to Rs, 2,500), food/drinks at restaurants without AC/heating or liquor license, flight tickets, third-party rail transportation.
Businesses selling these products or services have to register themselves and avail a GSTIN.
5%
Products –
- Equipment for the disabled
Parts and accessories for carriages designed for differently-abled individuals, walking sticks, hearing aids, braille paper, braille typewriters, and braille watches.
- Others
Marble rubble, natural cork, biogas, postage or revenue stamps, stamp-postmarks, first-day covers, ice and snow, numismatic coins, fly-ash bricks, coir mats, matting and floor covering, insulin, cashew nuts, cashew nuts in a shell, kites, wind-based atta chakki, etc.
Services –
Aircraft leasing, tour operator, transport services by air and taxis, goods imported from a vessel outside India, railways, and printing.
The GST registration procedure is simplified making it easier for businesses offering goods and services to register themselves. They only have to register for one tax provided they have one business vertical.
