Ever since government started talking about Goods and Services Tax (GST), it has been gaining a lot attention from the market for its implications on the common man. Now that government has finally decided the tax slabs for 1211 categorized items it has become important for the people to understand how much tax they will be shelling for all goods and services.
Below is a low down of GST tax slab for basic understanding:
Goods & Services With No Tax
Goods: No tax is levied on daily use goods like fresh meat, fish chicken, eggs, milk, butter milk, curd, natural honey, fresh fruits and vegetables, flour, besan, bread, prasad, salt, bindi. Sindoor, stamps, judicial papers, printed books, newspapers, bangles, handloom, etc.
Services: No tax on hotels and lodges with tariff below Rs 1,000.
Goods & Services That Will Attract 5% Tax
Goods: Fish fillet, cream, skimmed milk powder, branded paneer, frozen vegetables, coffee, tea, spices, pizza bread, rusk, sabudana, kerosene, coal, medicines, stent, lifeboats.
Services: Transport services (Railways, air transport), small restaurants.
Goods & Services That Will Attract 12% Tax
Goods: Frozen meat products, butter, cheese, ghee, dry fruits in packaged form, animal fat, sausage, fruit juices, Bhujia, namkeen, Ayurvedic medicines, tooth powder, agarbatti, colouring books, picture books, umbrella, sewing machine, cellphones.
Services: Non-AC hotels, business class air ticket, fertilisers, Work Contracts.
Goods & Services That Will Attract 18% Tax
Goods: Flavoured refined sugar, pasta, cornflakes, pastries and cakes, preserved vegetables, jams, sauces, soups, ice cream, instant food mixes, mineral water, tissues, envelopes, tampons, note books, steel products, printed circuits, camera, speakers and monitors.
Services: AC hotels that serve liquor, telecom services, IT services, branded garments and financial services.
Goods & Services That Will Attract 28% Tax
Goods: Chewing gum, molasses, chocolate not containing cocoa, waffles and wafers coated with choclate, pan masala, aerated water, paint, deodorants, shaving creams, after shave, hair shampoo, dye, sunscreen, wallpaper, ceramic tiles, water heater, dishwasher, weighing machine, washing machine, ATM, vending machines, vacuum cleaner, shavers, hair clippers, automobiles, motorcycles, aircraft for personal use.
“Unlike the previous tax regime, GST allows input for tax credits on construction materials which is a boon for developers. Apart from simplifying the whole mechanism of taxation, it also brings the much-needed transparency into the sector. GST will not have a significant bearing on the pricing for property buyers.”, said T. Ashok Naidu, Director, Kumari Builders and Developers.
Services: 5-star hotels, race club betting, cinema will attract tax 28% tax.