Rate Cuts On Card As GST Council Meeting Gets Underway 

A crucial meeting of the GST Council is currently underway today (22 December), in New Delhi, under the chairmanship of Union Finance Minister Arun Jaitley, PTI has reported.

The meeting comes just days after Prime Minister Narendra Modi indicated that 99 per cent of items under GST will be moved into the 18 per cent or lower tax brackets, given that the new indirect tax regime has stabilised.

Currently, the GST has five tax slabs: 0, 8, 12, 18 and 28 per cent. While the daily essential items attract nil tax, the ‘luxury and sin’ items and some white goods fall in the highest tax bracket, which is 28 per cent.

GST rates are expected to be cut for FMCG goods, tyres, and electronic items that were in the highest rate bracket.

Presently there are 34 goods in the highest tax bracket which includes air conditioners, dish washing machines, set-top boxes for TVs, monitors and projectors, tyres and construction items like cement.

The GST Council is expected to reduce the tax rates on cement and tyres to 18 from current 28 per cent.. Electronic items like air conditioners, power banks, computer monitors and dish washing machines will be cheaper as the GST on these products is likely to be pared.

According to this report in ABP, the government, in an attempt to give a big boost to its affordable housing scheme, is likely to persuade GST Council to lower the 12 per cent tax rate on housing to 8 per cent.

It is expected that items like aerated drinks, cigarettes, bidi, tobacco products, pan masala, smoking pipes, automobiles, aircraft, yachts, revolvers and pistols will be retained in the 28 per cent slab. Further simplification of Form GSTR-9 is also on cards.