GST Council sets 4 tier rates

GST Bill

New Delhi, November 3: The Goods and Services Tax Council meet on Thursday pegged up GST rate structure at 5, 12, 18 and 28 per cent as against the proposed rate at 6, 12, 18 and 26 percent in the last meeting.

The two-day GST council deliberations started in New Delhi today and the center and state could reach a consensus on the four-tier tax structure. The agenda for today’s meeting was to sort out the anomalies related to tax rates and revenue loss by the state.

Finance Minister Arun Jaitley said after the meet: Zero-tax rate to apply to 50 per cent of items in the Consumer Price Index basket, including grains used by the common man. 5 per cent duty will be levied on items of mass consumption used by common people.

 

 

According to the latest structure the two standard rates would be 12 and 18 per cent. Items taxed at 30-31 per cent will be taxed at 28 per cent. Additional revenue from highest tax slab will be used to keep essential use items at 5 per cent and common use items to 18 per cent.

“Luxuary cars, tobacco, aerated drinks to be levied with a cess, which along with clean energy cess, will be used to compensate States for loss of revenue. Compensation pool created through cess will be for five years. Rs. 50,000 crore is required to be paid to States for loss of revenue in the first year of GST rollout,” said Jaitely.

Wefornews Bureau

 

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