New Delhi: GST reforms are not just for rationalising rates but structural too, Finance Minister Nirmala Sitharaman said on Wednesday, adding that the decision of the GST Council has been taken with full consensus and all ministers supported rate rationalisation.
In most cases, GST rates have come down drastically, and rates have been cut for farmers and agriculture and health-related products, she said during a press briefing, after the 56th Meeting of the GST Council ended here.
“PM (Narendra) Modi desired to give the benefit of GST cuts to people at the earliest. These reforms are not only on rationalising rates, but they are structural too. We have corrected the inverted duty structure,” FM Sitharaman said.
The government has announced sweeping next-gen GST reforms to bring relief across sectors, from daily essentials and healthcare to farming, education, automobiles, and appliances.
With tax rates slashed on dozens of items, the reform promises to make living more affordable, empower small businesses, and boost India’s self-reliance under Aatmanirbhar Bharat, the Finance Minister said.
FM Sitharaman said that “in common man and middle class items, there is a complete reduction”.
It has been decided that the GST will be levied on retail sale price (RSP) instead of transaction value on pan masala, gutkha, cigarettes, unmanufactured tobacco, and chewing tobacco, like Zarda.
The changes in GST rates of all goods except pan masala, gutkha, cigarettes, chewing tobacco products like zarda, unmanufactured tobacco and bidi, will be implemented with effect from September 22.
The GST Council has taken various decisions and recommended various measures to facilitate trade.
FM Sitharaman said that a special rate of 40 per cent will apply only to pan masala, cigarettes, gutka, and other tobacco products. Caffeinated beverages and carbonated beverages will be covered in the 40 per cent slot.
All cars under 1200 cc and bikes under 350 cc will be charged at 18 per cent. Hair oil, soap, bars, toothpaste, bicycle, and tableware will now attract a levy of 5 per cent.
The GST on agricultural goods such as tractors, horticultural, forestry, machines for soil preparation or cultivation, harvesting or crushing machines, including straw of followers, grass, movers, and composting machines have come down from 12 to 5 per cent.
(IANS)
