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GST stands for Goods and Services Tax and it is classified into three types
And the GST rates are classified into 4 Tier Structure of which some of the commodities are placed in high tax brackets of 28% and basic essential commodities are placed in lower tax brackets of 5% and fewer commodities are placed in Nil rate tax slab.
As far as the initial drafted GST law we didn’t see major changes in GST rates as GST council tried to keep up the GST rates close to its original rates but the on go of changes in the economy made to push back the GST rates and as a result changes were made in GST rates now and then.
The table given below shows the GST tax rate on some common items -
|GST Goods Tax Rates||Products|
|5%||Household necessities such as edible oil, sugar, spices, tea, and coffee (except instant) are included. Coal, Mishti/Mithai (Indian Sweets) and Life-saving drugs are also covered under this GST slab|
|0.25%||Cut and semi-polished stones are included under this tax slab.|
|12%||This includes computers and processed food|
|18%||Hair oil, toothpaste and soaps, capital goods and industrial intermediaries are covered in this slab.|
|28%||Luxury items such as small cars, consumer durables like AC and Refrigerators, premium cars, cigarettes and aerated drinks, High-end motorcycles are included here.|
Though edible items like sugar, tea and coffee are included in the 5% slab, milk does not attract any tax under the new GST regime. The idea behind this is to ensure that basic food items are available for everyone but instant food is kept out of this category.
The government has proposed a 4-tier tax structure for all goods and services under the slabs- 5%, 12%, 18% and 28%. After the recent revision of GST rates, these are the commodities that fall under the four tax slabs along with those that do not attract any tax.
GST rate schedule for Goods that underwent changes :
|Rate of GST on goods|
Handlooms used in the handicraft industry are the only machinery charged at NIL rate of tax under GST. Most of the electrical machinery are charged tax at a similar rate to the rate declared under GST.
It is expected that the prices are going to stay neutral for the end consumer of the above electrical machinery. Although the manufacturers using electrical machinery will benefit from the availability of input tax credit on the services used which was not available under VAT.
|GST Goods Tax rate|
|12%||Sports goods other than articles and equipment for general physical exercise.|
|GST Goods Tax rate|
|12%||Only leather gloves specially designed for use in sports is taxed at 12% GST. All other leather products are taxed at 28% GST rate|
Payment Declaration Form – GST PMT – 08: Definition, Format and Rules