The five tier rate structures are presented in the public domain which was proposed by the GST panel on November 2016. In order to vindicate the hike of GST a large portion of the commodities and services are snugged in the bucket of 18% or below rates. Various items are exempted from the GST role or placed in the 5% bucket list. On the contrary, luxurious cars and SUVs are attracting the rate at 28% GST rate along with the compensation cess of 15%. The Modi government of India walked an extra mile to ease the tax rates of daily used products like shampoo and hair oil with the standard rate of 18% replacing the current tax rate of 28%.
In other cases for lodging in a five-star hotel the rates are high up to 28% , while rates for non-AC restaurants is 12% and 5% for small hotels. The rates for overall transport product prices and all modes of transport are reduced to 5%.
Transportation certainly will minimse the impact when it comes to expenditure, as the hike in petrol and the petroleum products have been exempted under the purview of GST law at the moment. Overall the tax rates under the GST regime are likely to get decreased as compared to the current taxation system. ArunJaitly said, “Therefore, there will be an adverse revenue impact if other things remain equal. But we are also hoping for revenue buoyancy and a check on inflation that GST will ensure so as to make up for that loss”.
The finance minister of India also added that under the GST regime, dealers, manufacturers, and restaurants with a turnover of up to Rs. 75 lakh can avail the composition scheme with lower rates of 5%, 2%, and 1%, respectively, with lower compliance against Rs. 50 lakh formerly.
With the announcement of revised GST rates, the government of India has taken admirable step in responding to the industries endorsement of the GST regime within a short time period. Moreover, the reduced and modified rates of almost 50% of the commodities are still pending.
Mr. Jaitley was firm with his words when he said that the implementation of GST will not wait for anybody. Now, that the GST rates are on full swing and the government is making crucial efforts to confirm hassle-free implementation of GST.
Some of the steps that are taken to revamp the systems are:
- Reducing the GST rates
- They launched a Twitter account to handle GST related queries.
All dressed up and ready, GST taxation system is prepared to get married to the Indian taxation system on 1st July 2017.