GST Tax Slabs Rates List 122142 views
Table of Contents
- 1 GST Rate Cut for 29 Goods & 53 Services
- 2 GST Return Filing Now in One Step
- 3 Updated New GST Tax Rates
- 4 Updated New GST Tax Rates of 177 out of 227 Items Reduced to 18% from 28% Slab
- 5 Eating Out Becomes Cheaper GST Tax Rates Reduced from 18% to 5% Slab
- 6 Various GST Tax Slabs in India
- 7 4 GST Tax Slab Rates List for Different Goods
- 8 4 GST Tax Slab Rates List for Different Services
- 9 What is GST?
- 10 Impact of GST
- 11 When Did GST Arrive in India?
- 12 Cess Hiked on Cars after GST
- 13 64% File GST Returns in July Government Collects ₹92,000 crore
- 13.1 Which Indirect Taxes Would GST Not Subsume?
- 13.2 Loans to Cost a Little More
- 13.3 GST Effect on Personal Loan
- 13.4 GST Effect on Home Loan
- 13.5 GST Effect on Car Loan
- 13.6 Big Breakthrough for Small Traders & Manufacturers Under GST Composition Scheme
- 14 Cabinet Gives Nod to CGST Refund Scheme
- 15 Council Extends GST Return Filing Date
- 16 Guidelines to File GST Returns
GST Rate Cut for 29 Goods & 53 Services
Days before the Union Budget 2018-2019, the GST Council in its 25th meeting on Thursday has slashed the rates of 29 items and 53 categories of services. The Council, was headed by the Finance Minister Arun Jaitley and has decided the new rates will soon be effective from 25th January 2018. The apex decision making body of the tax has decided to reduce the prices of old and used motor vehicles to 12%, medium & large cars and SUVs from 28% to 18%. LPG supply to domestic household consumers by private LPG distributor will come down to 5% from 18% slab. Not only this, the rate on bio fuel powered buses has also been reduced to 18% from 28%. Along with this, the rate of diamonds and precious stones has been cut from 3% to 0.25%. Apart from this, the rates of few agricultural products have also been reduced while keeping 29 handicraft items in 0% slab.
However, if we talk about the services, the Council has reduced the tax rate on tailoring service from 18% to 5%. In addition to this, admission to theme parks, water parks, joy rides, merry-go-rounds, go-carting and ballet will also come down to 18% from 28% of tax slab.
GST Return Filing Now in One Step
Another update which grabbed the attention of all is the announcement on GST Return Filing, making the process simpler for businesses. The Union Finance Minister said ”One key issue before the council was simplification of the return process.” Moreover, this new GST one-step plan, which is still in the talks, seems to revolve around on three forms-GSTR1, GSTR2 and GSTR3 and will replace them with GSTR3B , initially with uploading of a supply invoice. An official in the meeting also stated that this may be further simplified with just the supply invoice, which needs to be uploaded along with deciding the return filing frequency. If we talk more about the same, the taxes can be deposited on the basis of an invoice and if any mismatch takes place between buyer and seller invoices, an explanation can be sought.
Here are the Highlights:
- GST Rates slashed for 29 items and 53 services
- 29 Handicraft items are in 0% slab. Rates of few agricultural products have also reduced
- The testing of E-way bill continues till 25th January 2018, loading of the same is compulsory from 1st February 2018
- 3B Return Filing may continue
- 15 States have agreed on Intra-State E-way Bill
- Decision on Real Estate and petroleum products will be taken on next meeting
- A collection of₹307 crore under composite scheme
- The integrated GST collection of₹35,00 crore will be divided between the Centre and the States
Updated New GST Tax Rates
The 2-day GST Council meeting, which kicked off on November 9 in Guwahati, the capital city of Assam, has decided to lower the tax rates of 177 items falling under the highest slab of 28% to 18%, in line with the expectations.
Updated New GST Tax Rates of 177 out of 227 Items Reduced to 18% from 28% Slab
Currently, 227 items lie under the 28% slab. Now with the latest announcement, only 50 would remain in 28% club. Confirming the news, Sushil Kumar Modi, the GST Council member, stated that tax rates on numerous items under 28% rate have come down to 18%, thus bringing the total number of items in the top slab to just 50. The items which have moved to 18% regime include chocolates, beauty products, shaving cream, aftershave kits, chewing gum, marble, granite, handmade furniture, plastic products, among others.
Eating Out Becomes Cheaper GST Tax Rates Reduced from 18% to 5% Slab
Here comes the good news for all the foodies out! The GST Council on Friday has slashed the rates for both air-conditioned and non-air -conditioned restaurants to 5% without input tax credit which will be effective from 15 November. Earlier, the Council had pegged the rates for air-conditioned and non-air-conditioned eating joints and those with a liquor license at 18% and 12% respectively. However, the rates will remain unchanged to 18% for outdoor catering and restaurants situated inside the hotel premises with tariffs of ₹7,500 and above along with the benefit of input tax credit. If experts are to be believed, the move of paying less for eating out and ordering food is a rejoice for consumers.
Various GST Tax Slabs in India
4 GST Tax Slab Rates List for Different Goods
|5% GST Tax Slab Items||12% GST Tax Slab Items||18% GST Tax Slab Items||28% GST Tax Slab Items|
4 GST Tax Slab Rates List for Different Services
|GST Tax Slabs||Services|
|5%||AC and Non AC Restaurants|
Restaurants in hotels with a room tariff less than ₹7,500 (no input credit for these restaurants)
Transport services like railways and airways
Transport of passengers by air in economy class
Supply of tour operators’ services
Selling of space for advertisement in print media
Small restaurants with turnover of Rs. 50 Lakhs
Transport of passengers by motor cabs and radio taxis
Small house-keeping service providers (No input credit available)
Crude and petroleum product transportation
Job work for footwear and leather goods
|12%||Business class air tickets|
Hotels, inns, guest houses, which have a room tariff of Rs.1000 and above but less than Rs.2500 per room per night
Metro and monorail construction
Mining and drilling for crude or natural gas
Common effluent treatment plants
|18%||Restaurants in hotels with tariff at over ₹7,500 Outdoor Catering (input tax credit to be available)|
Hotels, inns, guest houses, which have a room tariff of Rs.2500 and above but less than Rs.5000 per room per night
Theme parks, water parks and alike
|28%||Race club betting & gambling|
Entertainment & Cinema
Hotels, inns, guest houses, which have a room tariff of Rs.5000 and above per room per night
What is GST?
GST stands for Goods and Service Tax, which by virtue of its launch, has replaced the previous structure of multiple taxes levied by the state and central government. It is a consumption based indirect tax which is charged on sale, manufacturing and consumption on goods and services at the national level. Exports and direct taxes like income tax, corporate tax and capital gain tax will not be affected by GST. The much-awaited GST has a dual tax system comprising of –
- Central GST or CGST – To be charged by the central government.
- State GST or SGST – To be charged by the state government.
- Integrated GST or IGST – To be charged by central government on the inter-state supply of various goods and services.
Impact of GST
Since India has different GST tax rates compared to a single GST rate in most prosperous nations across the globe, the national economy would undergo a major shift from the times of multiple taxes. From a common man to the riches, the word GST will have a significant bearing. While some goods and services would become cheaper, others may just take out more from the pocket of the consumers. The game changer, however, could be the input tax credit that the manufacturers can avail, which hopefully should benefit the consumers at large. The manufacturers can claim tax credit for the raw materials they procure, as well as for using the services like advertising, marketing and training. Similarly, the service providers can avail the credit for the goods they procure.
Relief for Exporters
There is also a good news on the outward shipment as exporters would be exempted from paying IGST for 6 months. Adding more impetus to the Digital India Mission, the council has announced to develop e-wallet gateway and introduce it by April 1 next year. The refund cheques for July and August exports would be processed by October 10 and October 18, respectively. The government will deposit a notional amount as an advance refund in e-wallets for exporters.
On the other hand, Small Medium Enterprises (SMEs), with an annual turnover of ₹1.5 crore, are allowed to file quarterly returns.
Composition Scheme Widened
The composition scheme net has been widened to taxpayers with a turnover of up to ₹1 crore from the existing limit of ₹75 lakh. Under the said scheme, the manufacturing companies and restaurants will have to pay 2% and 5% tax, respectively.
When Did GST Arrive in India?
Finally, the landmark event in India’s taxation history arrived on July 1, 2017, when GST (Goods and Services Tax) became the reality. The biggest reform, which is expected to simplify the Indian tax structure, was launched by the Prime Minister Narendra Modi in the Central Hall of Parliament in the wee hours of 1st July. Jammu & Kashmir, previously, was not the part of the GST regime. But with the state assembly passing the bill despite a boycott by the opposition, the GST in J&K has become a reality now. The GST scheme consists of a four slab structure under which the proposed goods and services will be taxed accordingly. The four slabs are 5%, 12%, 18% and 28%. The five services, which feature a taxation of 28% under GST, include five-star hotels, racing, movie tickets and betting on casinos and racing. Education and healthcare are exempted from the tax regime and will continue to remain unaffected. The majority of the services form the part of the 18% tax slab. The scheme is expected to have a mixed effect on the industry as the impact of the same will be visible in the upcoming few years.
GST Council Slashes Rates for Items in October
The Finance Minister Arun Jaitley has announced a growing list of rate reductions. The unbranded ayurvedic medicines now come under the tax slab of 5%, down from 12%. Gas stove and consumer articles have been moved to a lower tax bracket from the high of 28%. Giving a relief to the artisans, the GST Council has cut the rate of some handicraft items to 5% from the existing 12%. The rates of yarn and clips are also slashed to 12% and 18% respectively, providing a fillip to the country’s textile industry. Even the rates for several job work items are reduced to 5% from 12%. Meanwhile, the council has granted an in-principle approval to bringing down the rates of AC restaurants to 12% from 18% at present.
The GST Council meeting, which took place between the Union and State Finance Ministry Officials on October 6, has come out with a slew of relief measures for the businesses and public in general. In order to provide a big festive cheer here’s came an announcement on jewellery purchases exceeding ₹50,000 won’t require PAN Card. However, the biggest of all was the announcement of reducing the GST rates of 27 products and a few services. The Council headed by Jaitley decided to continue the two pre-GST era schemes, allowing duty-free sourcing of materials for export production till March, 2018.
GST Council Slashes Rates for More than 40 Items in September
The GST Council, in its meeting on September 9, 2017, decided to lower the rates of more than 40 items. These items are walnut, clay idols custard powder, corduroy fabric, saree fall, dhoop batti, raincoat, rubber bands, idli dosa batter, prayer beads, computer monitors, kitchenware, table, and others. Meanwhile, the Khadi sold at KVIC outlets are exempted from GST levy.
Hard for Branded Food Businesses to Evade GST
The GST Council meeting, which spanned for hours, came with a decision to impose 5% tax on branded food businesses registered on May 15, 2017. So even if these businesses de-register later, they would have to pay 5% tax.
Boost for Small Handicraft Traders
Handicraft traders, who sell their products to other states, won’t have to register for GST in case the turnover is below₹20 lakhs.
Cess Hiked on Cars after GST
The cess on motor vehicles such as mid, large and sports utility vehicles (SUVs) is also hiked by the council to the tune of 2%, 5%and 7%, respectively. So, the overall incidence of the tax is likely to be 45% in the case of mid-size cars, 48% for large cars and 50% for SUVs. However, the council maintained a status quo on hybrid and small cars.
64% File GST Returns in July Government Collects ₹92,000 crore
64% population filed their ITRs in the month of July, resulting in a collection of ₹92,283 crore received by Centre and State Government as Goods and Service Tax (GST). In the first month of its roll out, this indirect tax regime exceeded the Union and State Government’s target of₹91,000 crore. Finance Minister, Arun Jaitley in his statement on Tuesday said that a total number of 64.42% of the registered taxpayers, excluding composition dealers and registrants in August, filed their returns in the month of July under GST. He also stated that ‘’we have crossed the red line so far as tax targets are concerned.’’
Talking about the targets in the annual budget, the Central Government’s July tax revenue should have been₹48,000 crore and that of States at₹43,000 crore, assuming 14% growth each in 2016-17 and 2017-18 over the 2015-16 revenues of the states. Thus, the combined kitty comes to₹91,000, he said, adding that they have ‘exceeded the target.’ With respect to GST collections affecting the fiscal deficit based on the July tax numbers, he said, ‘’It is too early to comment.’’
Explaining the reason to the masses, he said now that the internal estimate had been breached in the first month of GST implementation, it meant that many businesses that were not paying the taxes are now coming into the net.
If we look at the calculation of₹92,283 crore,₹7,198 crore came from the cess, which will go to the states as compensation. Of the remaining amount,₹14,894 crore has been collected as Central GST (CGST),₹22,722 crore as state GST (SGST) and₹47,469 crore as integrated GST (IGST) , including₹20,964 crore as IGST from imports. However, the exact revenue figures of Central and State Governments will be known after the cross utilisation report of IGST for the payment of SGST and CGST that will be prepared by GSTN (GST Network) by 31 August.
Out of 59.57 lakh registrants, 38.38 lakh people have filed their returns in July, making a total of 64.42 per cent. Till date, 72.33 lakh taxpayers have migrated to the new GSTN system, out of which 58.53 lakh have completed all the required formalities. Those who haven’t paid the GST, they have to bear a late filing penalty of₹100 per day for CGST and SGST each. They can also file the taxes by paying an interest of 18% yearly. Tax analysts noted that many companies were not able to file their input tax credit due to some issues with TRAN-1 Form, which was required to be filled for availing the transactional credit.
Which Indirect Taxes Would GST Not Subsume?
Yes, the GST is expected to subsume a bundle of indirect taxes. However, a few of them would be out of GST ambit. These include-
- Export Duty
- Basic Customs Duty
- Toll Tax
- Stamp Duty
- Property Tax
- Road & Passenger Tax
- Electricity Duty
Loans to Cost a Little More
Those applying for a personal loan, home loan and other types of credit facility would have to shell out 3% more tax on the processing fee and other charges payable on the loan in the advent of 18% GST rate implementation. Previously, a 15% service tax was chargeable on the same.
GST Effect on Personal Loan
In the case of a personal loan, the processing fee can be anywhere between 1%-2% of the loan amount. The fee so arrived will be under the purview of 18% GST. So, if the processing fee comes out to be₹20,000, the GST of ₹3,600 would be applicable. The same rate will be applicable on prepayment which incurs a fee of 2%-5% of the outstanding balance on a given date.
GST Effect on Home Loan
The processing fee of a home loan is somewhere between 0.25%-1% of the loan amount sanctioned. On the fee amount, a GST tax rate of 18% would be applicable. Prepayment, however, can be free of cost if taken on a floating basis. On a fixed rate loan, a fee of 2%-3% of the outstanding loan plus 18% GST would be charged.
GST Effect on Car Loan
To get the dream car home on a loan, a processing fee at 1%-2% of the loan amount would be debited at the time of application. In addition, a tax of 18% on the fee amount would be charged from a borrower. Prepayment, on the other hand, bears a penalty of 2%-5% of the outstanding amount. Beyond which, the same tax rate of 18% will apply.
Big Breakthrough for Small Traders & Manufacturers Under GST Composition Scheme
The Council also decided to allow all the small traders, restaurants and manufacturers with a turnover of ₹75 Lakhs to opt for a composition scheme. This move comes as a big respite to the small business owners who will now be able to opt for a composition scheme and hence pay taxes at 1-5 percent. The government expects to strengthen the small and medium enterprises through this step. Earlier the limit for the same was set at ₹50 Lakhs. Under this scheme, the small business owners have the provision to pay 1-5% GST rate on the annual sales they make without any tax credits.
GST Impact on Companies- Reprint Revised MRP or Face Jail Term, Warns Govt
In what could safeguard the interests of consumers at large, the Union Consumer Affairs Minister Ram Vilas Paswan has taken a hard stance on the companies saying they must reprint the revised MRP post-GST tax rates. Failing to do so will attract penalty and even the jail term. Let’s see how these punishments stack up.
- First-time offence would attract a penalty of₹25,000
- Second-time violation of the norm would lead to a penalty of ₹50,000
- Third-time violation would put before a penalty of ₹1 lakh or even the jail term
This was all about the tax rates that are now applicable on various goods and services as per GST and the compliance to be followed by the companies. But what about filing the GST returns? It is equally important to know that as well. So, stay glued folks, as a comprehensive list of information pertaining to filing GST returns is coming your way.
Cabinet Gives Nod to CGST Refund Scheme
The union cabinet has given its approval to a new metro rail policy scheme to refund Central Goods and Services Tax (CGST) to industrial units located in Uttarakhand, Himachal Pradesh, Jammu & Kashmir and the North-eastern states. The scheme will also ensure changes to strategic disinvestment policy to increase the pace of decision making. The cabinet has earmarked a budgetary allocation of ₹27,413 crore.
The industrial units, via this scheme, can get a refund of 58% on CGST. Finance Minister Arun Jaitley while addressing the press said, “within the framework of the GST Act, each industry will be entitled to its refund mechanism until March 31, 2027”.
Council Extends GST Return Filing Date
The GST Council has also decided to extend the deadline for GST return filing in the wake of heavy load that the GSTN portal is witnessing of late. Now, the date of filing GSTR 1, which was to be filed by September 10, has been extended to October 3 and October 10 for large and small businesses, respectively. The council has also allowed businesses to file GSTR 3B for 4 months till December. The date of filing GSTR 2 and GSTR 3 for July has been extended to October 31 and November 10, respectively, revealed Revenue Secretary Hasmukh Adhia. He added that GSTR 1, 2,3 filing for August will be communicated soon.
Guidelines to File GST Returns
As it is not clear regarding the rates to be charged for various goods and services, people, especially business persons and small traders are confused as well as scared of the complex procedure of filing the GST Returns. When it comes to GST Returns, a lot of misconceptions regarding the same have created a bad impression of the complexity around it. But, you will be glad to know that filing the GST Returns is an easy procedure. Wanna know how? All you need to do is just read the post further as we have listed below the basics for you.
Those Who Need Not to Bother
If we go by statistics, approximately 80% of the businesses will either don’t need to file the return or file just once in 3 months. Yes, that’s right!
- Those who are having a turnover below ₹20 Lakh need not to file any return. They don’t need to worry with the GST rollout.
- Those with a turnover of more than ₹ 20 Lakh but below ₹75 Lakh, should read this. Why? As they need to file one return in three months, which means four returns in a year.
- Not only this, the individuals don’t need to give any details of the invoices. However, if someone has opted for a composition scheme, they need to deposit a lump sum amount in the tax without giving much details to the government. All they need to do is just disclose the total turnover.
Form GSTR-1: Those who are having a turnover of more than ₹75 Lakh and are B- to- C enterprise (business to consumer, including most of the retail sector) will need to file one return GSTR-1, disclosing total sales turnover and nothing else.
Form GSTR-2: It is actually not a return, rather a computer generated account of all the invoices as furnished by the suppliers. Here, people don’t need to file any return but make sure that all their business reflects in GSTR-2, which is not a return but the details of the purchases due to which individuals will get their input tax credit. However, GSTR-2 is not supposed to be filed by an individual as it automatically gets generated when the suppliers file their own GSTR-1.Well, you just need to approve the same.
Form GSTR-3: It is also not a return but a combination of GSTR-1 and GSTR-2 and is computer generated. Basically, it gives the summary of the total output tax liability and input tax credit. Moreover, the difference between the two is the final tax liability of the month. It is for your review purpose and if you find all the details being reflected correctly, all you need to do is just approve the same. Thus, you just need to file one return, and the government will send you two computer-generated returns with additional information so that you can check and approve the same.
However, talking about the invoices to be filed under GST, only suppliers to resellers (B2B suppliers) not under the composition scheme have to file invoice-wide details. When it comes to composition scheme (paying tax at a flat rate without input credits), it is available for service providers and manufacturers, enjoying an annual turnover of upto Rs.75 Lakh . For the seamless transition into the new indirect tax regime, the GST Return filing process has been simplified with Form GSTR-3B, containing only summary details. Well, for the acclimatization of the taxpayers with the new tax regime, the same form has been provided to all classes of taxpayers.
GST Return Filing Details
|Return for the Month of ||Form GSTR-1||Form GSTR-2||Form GSTR-3 |
|July 2017||October 3 for Large Businesses, October 10 for Small Businesses||October 31||November 10|
|August 2017||20th September instead of 10th September (Previous Scenario). It may change.||25th September instead of 15th September (Previous Scenario). It may change.||20th September (Previous Scenario). It may change.|