Over 50 products cheaper as GST Council slashes rates

Sanitary Napkins exempted from GST, rates cut for 50 other items

After chairing the 28th GST Council meeting, interim finance minister Piyush Goyal on Saturday announced huge rate cuts on a number of commodities under the Goods and Services Tax (GST). Earlier, sanitary napkins were taxed at 12% which had attracted a lot of criticism.

The council also approved a simplified return filing mechanism wherein all taxpayers, excluding small taxpayers, will now file one monthly return with two main tables - one for reporting outward supplies and one for availing input tax credit based on invoices uploaded by the supplier.

Despite this, Jaitley's successor in the finance ministry, Piyush Goyal, has gone ahead and done just that. A Meerut based NGO had sent a packet of the sanitary to Prime Minister Narendra Modi protesting against the 12 per cent tax levied on the product, as reported by The Times of India.

Goyal asserted on the importance of reducing the tax on ethanol, as not only is it used for blending with petrol and diesel, it is also vital for the sugar industry, and will thus be very beneficial for the sugarcane farmers.

It was meant to unify the over US$2 trillion economy into a single market, with four tax rates of 5, 12, 18 and 28 per cent. They launched the viral campaign #lahukalagaan (tax on blood), which had the support of comedians like Kaneez Surka, Mallika Dua and actor Aditi Rao Hydari. "Besides revenue collection, the GST council will now focus on job creation as well". The new prices will be effective from July 27.

"The simplification of returns and allowing traders below Rs 5 crore turnover to file quarterly returns will positively lower compliance burden". While the changes will offer relief to the middle-income households and small businesses, sources say the government stands to lose revenue to the tune of Rs 15,000 crore.

The government also reduced rates on an array of daily-use appliances and products, including small TV, washing machine, refrigerator, paint, perfume, footwear up to '1,000, and handicraft items. The next meeting of the Council is slated on August 4, which will discuss issues relating to the MSME sector as well as ways to incentivise digital transaction via Rupay cards and BHIM app.

I think the 28 percent tax slab should be done away with.

Other than sanitary napkins, rakhi too has been made GST free. Around 90 consumer items, many of them popular with urban middle-class voters, will be impacted by the tax cut.

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