The GST council under the proposed rate rationalisation has sought to increase the GST rates on 143 items. Out of these 143 items, 92% of items are proposed to be shifted from 18 per cent of the tax slab to 28 per cent slab. These items include papad, jaggery, watches, suitcases, power banks, handbags, perfumes, deodorants, colour TV sets (below 32 inches), chocolates, chewing gums, and custard powders, and non-alcoholic beverages, washbasins and other items essential in day to day life.
Many of these changes in the tax rates will reverse the rate cut decisions taken by the GST council in the previous years.
Proposed GST Rates on Different Items
The following proposed GST rates on different items are given below:-
- GST rates for items such as leather apparel, perfumes, chocolates, cocoa powder, accessories, beauty or makeup preparations, floor coverings of plastics, lamps, sound recording apparatus and armoured tanks are said to be hiked again.
- Similarly, the GST rates for electronic appliances such as coloured TV sets (below 32 inches), digital and video camera recorders and power banks are increased again. The tax rates for these appliances were reduced in the GST council meeting that was held in December 2018.
- GST rates for food items such as walnuts may get increased to 12 per cent from 5 per cent, for custard powder to 18 per cent from 5 per cent and for table and kitchenware, it may increase to 18 per cent from 12 per cent. GST rates on papad and jaggery may move from zero per cent to 5 per cent tax slab.
- GST rates on clothing apparel and other accessories such as leather apparel, wristwatches handbags and other kinds of bags, razors, perfumes, pre-shave/aftershave creams, dental items and food items such as waffles, chocolates, cocoa powder extracts, non/alcoholic drinks and beverages, along with other household appliances such as washbasins, ceramic sinks, plywood, doors, windows may get increased from 18 per cent to 28 per cent.
Because the GST rate cuts on various items, it was estimated to have resulted in a revenue loss of about Rs. 70,000 crores in a year. States are asked for their opinions and inputs regarding the proposed hike in GST rates. The rate changes will be implemented in different phases. The robust increase in the GST rates has witnessed the striking development and boom in many sectors.