4 GST Tax Slab Rates List in India for Various Goods and Services

GST Tax Slabs Rates List 76945 views

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.

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.

GST Council Slashes Rates for More than 40 Items

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

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.

Various GST Tax Slab in India

No Tax

  • Goods - No taxes will be levied on goods like milk, fruits, vegetables, bread, salt, bindi, curd, sindoor, natural honey, bangles, handloom, besan, flour, eggs, stamps, printed books, judicial papers, and newspapers.
  • Services - All hotels and lodges who carry a tariff below ₹ 1,000 are exempted from taxes under GST.

Tax Slab of 5%

  • Goods - The goods which will attract a taxation of 5% under GST include skimmed milk powder, fish fillet, frozen vegetables, coffee, coal, fertilizers, tea, spices, pizza bread, kerosene, medicines, agarbatti, insulin, cashew nuts, lifeboats etc,
  • Services - Small restaurants along with transport services like railways and airways will come under this category.

Tax Slab of 12%

  • Goods - Items coming are the tax slab of 12% include frozen meat products, butter, cheese, ghee, pickles, Ayurvedic medicines, sausage, fruit juices, bhujia namkeen, tooth powder, umbrella, instant food mix, cell phones, sewing machine etc.
  • Services - All Non-AC hotels, , business class air tickets will attract a tax of 12% under GST.

Tax Slab of 18%

  • Goods - As mentioned above, most of the items are part of this tax slab. Some of the items are flavored refined sugar, cornflakes, pasta, pastries and cakes, preserved vegetables, tractors, ice cream, sauces, soups and mineral water.
  • Services - All those AC hotels which serve liquor, IT and Telecom services and financial services along with branded garments will be part of this tax slab.

Tax Slab of 28%

  • Goods - Over 200 goods will be taxes at a rate of 28%. The goods which will be part of this category under GST are deodorants, chewing gum, hair shampoo, sunscreen, pan masala, dishwasher, weighing machine, vacuum cleaner. Other items include shavers, automobiles, hair clippers, motorcycles.
  • Services - As mentioned above, five-star hotels, racing, movie tickets and betting on casinos and racing will come under this category.

4 GST Tax Slab Rates List for Different Goods

5% GST Tax Slab Items12% GST Tax Slab Items18% GST Tax Slab Items28% GST Tax Slab Items
  • Sugar

  • Tea

  • Skimmed milk

  • Milk food for babies

  • Edible oils

  • Roasted coffee beans

  • Packed paneer

  • Frozen vegetables

  • Cashew nuts

  • Spices

  • Pizza bread

  • Rusk

  • Sabudana

  • Fish fillet

  • Packaged food items

  • Fertilizers

  • Footwear upto ₹500

  • Apparels upto₹1,000

  • Agarbatti

  • Domestic LPG

  • Floor covering

  • Coir mats

  • Matting

  • Insulin

  • Medicines

  • Stent

  • Braille watches

  • Braille typewriters

  • Braille paper

  • Hearing aids

  • Postage stamps

  • Revenue stamps

  • First day covers

  • Stamp-post marks
  • Ghee

  • Butter

  • Fruit juice

  • Almonds

  • Packed coconut water

  • Preparations of vegetables

  • Fruits

  • Nuts

  • Pickle

  • Murabba

  • Chutney

  • Jjam

  • Jelly

  • Namkeen

  • Bhujia,

  • Frozen meat products,

  • Packaged dry fruits

  • Animal fat sausage,

  • Non-AC restaurants

  • State-run lotteries

  • Exercise books

  • Notebooks

  • Work contracts,

  • Apparel above ₹1000

  • Tooth powder

  • Spoons

  • Umbrella

  • Cake servers

  • Sewing machine

  • Ladles

  • Forks

  • Tongs

  • Skimmers

  • Fish knives

  • Mobile

  • Diagnostic kits & reagents

  • Ayurvedic medicines

  • Glasses for corrective spectacles and flint buttons

  • Playing cards

  • Ludo

  • Carom board

  • Chess board
  • Biscuits

  • Flavoured refined sugar

  • Cakes,

  • Pastries

  • Preserved vegetables

  • Soups

  • Ice cream

  • Pasta

  • Instant food mixes

  • Corn flakes

  • Curry paste

  • Mayonnaise

  • Salad dressings

  • Mixed condiments

  • Mixed seasonings

  • Branded garments

  • Footwear priced above ₹500

  • Headgear

  • Soap

  • Hair oil

  • toothpaste

  • tampons

  • toiletries

  • kajal pencil sticks

  • tissues

  • computers

  • printed

  • circuits

  • printers

  • monitors

  • camera

  • speakers

  • CCTV

  • Electrical transformer

  • Optical fiber

  • Bidi Patta

  • Mineral water

  • Tissues

  • Envelopes

  • Steel products

  • Weighing machinery (non-electrical or electronic)

  • Aluminium foil Furniture

  • Bamboo

  • Padding pools Swimming pools
  • Chewing gum Molasses

  • Chocolates devoid of cocoa

  • Waffles and wafers coated with chocolate

  • Deodorants

  • Shaving creams

  • After shave

  • Shavers

  • Hair shampoo Sunscreen

  • Dye

  • Hair clippers

  • Ceramic tiles

  • Paint

  • Wallpaper

  • Washing machine

  • Water heater

  • Vacuum cleaner

  • Dishwasher

  • Automobiles Motorcycles

  • Aircraft for personal use

  • Pan masala

  • Bidis

  • Weighing machine ATM

  • Vending machines

  • Aerated water

4 GST Tax Slab Rates List for Different Services

Tax SlabServices
5%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
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
18%AC hotels which serve liquor to customers
Non-AC restaurants serving food and other takeaways
Hotels, inns, guest houses, which have a room tariff of Rs.2500 and above but less than Rs.5000 per room per night
IT services
Telecom services
28%Race club betting & gambling
Five-star Hotels
Entertainment & Cinema
Hotels, inns, guest houses, which have a room tariff of Rs.5000 and above per room per night

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.

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.

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.

Apply-For-Personal-Loan-after-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.

Apply-for-Home-Loans-post-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.

Apply-for-Car-Loan-after-GST

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-1Form GSTR-2
Form GSTR-3
July 2017
October 3 for Large Businesses, October 10 for Small Businesses
October 31November 10
August 201720th 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.