Business News
Arun Jaitley hints at cutting down GST rates on products in 28% tax slab
Finance Minister Arun Jaitley today hinted at bringing down the number of products in 28% GST slab. While speaking at India Today Conclave Next 2017, the Finance Minister said that some of the items should never have been in the 28 per cent slab.
“We have been gradually bringing them down. The whole idea is, as your revenue collections neutralise we must prune it and that is the pattern in which the Council has so far been functioning. I see that as a future guide as far as the Council is concerned,” Jaitley said. The GST Council in the last 3-4 meetings has slashed rates on over 100 items.
The Finance Minister’s hint came a day after reports emerged that the GST Council may consider lowering the taxes on some of the products placed in higher tax category. The Council is scheduled to meet on November 10. According to the reports, the government may slash taxes on certain common use items such as handmade furniture, plastic products and daily use items like shampoo.
The GST Council has readjusted rates for many items since the implementation the new tax regime and further changes are anticipated. “A rationalisation of items in the 28 per cent tax bracket is expected. Most of the daily use items could be lowered to 18 per cent. Also tax rate on items like furniture, electric switches, plastic pipes could be relooked,” PTI reported on Monday.
Earlier in October, Revenue Secretary Hasmukh Adhia had advocated for a complete overhaul of the tax rates under the GST regime. In an interview to PTI, Revenue Secretary said: “There is a complete overhauling that is required. It is possible that some items in the same chapter are divided. There is a need for harmonisation of items chapter wise and wherever we find there is a big burden on small and medium businesses and on common man, if we bring them down, there will be a better compliance.”
He, however, said the overhauling would require some calculations by the fitment committee, which will decide which items need a rationalisation of rate under the GST. The GST Council has already cleared an approach paper for items to be considered for rationalisation but it is not binding and the council can always make deviation from the approach paper.
