Tobacco GST News: According to an official, the GoM on GST rate rationalization voted Monday to increase the tax on sin items, including as cigarettes, aerated beverages, tobacco, and associated products, from the current 28% to 35%.
GoM Makes a Decision on Apparel's GST Rate Rationalization
Under Bihar Deputy Chief Minister Samrat Chaudhary, the Group of Ministers (GoM) on rate rationalization also made the decision to rationalize clothing tax rates.
Updated Ready-Made Garment GST Rates
According to the ruling, ready-made clothing up to Rs 1,500 would be subject to 5% GST, while items between Rs 1,500 and Rs 10,000 would be subject to 18%. Over Rs 10,000 worth of clothing would be subject to a 28% tax.
Revision of Tax Rates on 148 Items Proposal
The GST Council will receive proposals for tax rate changes on 148 products from the GoM on rate rationalization. "There will be a positive impact on net revenue," an official stated.
The GST Council will discuss the GoM Report.
On December 21, the GST Council, which is chaired by the Union Finance Minister and includes her state equivalents, is anticipated to examine the GoM report. The council will make the final decision over changes to the GST rate.
A special rate of 35% is suggested for aerated beverages and tobacco.
The GoM has consented to suggest a special rate of 35% on aerated beverages, tobacco products, and related goods. "The four-tier tax slab of 5, 12, 18, and 28 percent will remain in place, and the GoM has proposed a new rate of 35 percent," the official stated.
Current GST Structure and Its Relevance
There are now four tax slabs under the GST, with rates of 5, 12, 18, and 28%.
Luxury and demerit items are subject to the highest slab of GST, whereas necessities are either excluded or charged at the lowest slab. Cess is levied on top of the highest 28% slab for luxury goods like cars and washing machines and demerit goods like tobacco products and aerated water.
completion of the GoM Report
According to the official, the GoM's report on rate rationalization was completed on Monday and will be given to the council.
Rate Rationalization Efforts Continue
According to the source, the council will now determine whether there is still room for rate rationalization and may choose to keep the GoM on board so that the rationalization process continues on a regular basis.
Highlights of the October Previous GoM Meeting
The GoM had suggested at its most recent meeting in October:
GST on 20-liter and larger bottles of packaged drinking water will be lowered from 18% to 5%.
Bike purchases under Rs 10,000 would now just pay 5% GST instead of 12%.
lowering the GST rate on exercise notebooks from 12% to 5%.
The GST rate on shoes costing more than Rs 15,000 per pair has been raised from 18% to 28%.
raising the GST rate from 18% to 28% on wristwatches over Rs 25,000.
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