According to the rate structure finalised by the GST Council here, all cars, buses, trucks and motorcycles including moped as well as personal aircraft and luxury yachts will attract a peak Goods and Services Tax (GST) of 28 per cent. "In fact, for many of them, taxes have come down", Finance Minister Arun Jaitley told the media here after the first day of the GST Council meet.
Similarly, most mobile phones may get costlier by 4-5% after the GST rate was fixed at 12%, which will make locally manufactured devices more expensive as they now operate under lower tax rates due to benefits provided for local manufacturing. The tax rates are divided into 4 tax slabs, namely, 5%, 12%, 18%, and 28%. In a crucial meeting, the GST council in Srinagar today finalised the rates at which various commodities will be taxed once the one tax for all kicks in from July 1. The tax rate for AC restaurants and those with liquor licence will be 18 per cent. Till now both the staples invited taxes in different states between 1 and 5 per cent. Milk has been added to the exempted category though in states like UP it was not taxed. Sugar, tea, coffee will meanwhile attract 5 per cent tax rate.
Jaitley said most of the work relating to GST rollout has been completed and only a few things remain.
Around 400 items are now exempt from excise and VAT under the existing indirect tax regime.
Coal will attract GST of 5 per cent as against the current tax incidence of 11.69 per cent.
The Goods and Services Tax Council on Friday could not decide tax on Gold following differences between consuming and producing states.
This rate will apply to cab aggregators like Ola and Uber as well as those who now pay 6 per cent tax. 14% VAT and other levies takes total taxes upto 27% while GST will bring with it an added 1% taking total taxes to 28%. However, travelling on business class would get costlier with 12 per cent tax.
"The machinery for the anti-profiteering authority may not be ready at present but any change in prices will be called into questioned", Revenue Secretary Hasmukh Adhia said, adding that any fluctuations in prices will be closely monitored. In the overall basket, there will be a reduction, but we are banking on the hope that because of a more efficient system, evasion would be checked and tax buoyancy would go up.