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The Group of Ministers (GoM) on Goods and Services Tax (GST) rate rationalisation is likely to push for phasing out the 12 percent tax slab by gradually shifting items to either the 5 percent or 18 percent slabs to simplify the tax framework and ease compliance for businesses, people familiar with the development said.
A ministerial panel on GST rate rationalisation is considering lowering GST rates on several mass-use items, including medicines and tractors, to 5%. However, the tax on products like cement is likely to remain unchanged. Tractors currently face a 12% or 28% GST, depending on their classification.
The Group of Ministers (GoM) on GST rate rationalisation is understood to be in favour of reducing the tax rate on many items including ”education materials” to 5% from 12% to provide relief to large sections of people.
The Group of Ministers (GoM) on goods and services tax (GST) rate rationalisation, which convened in Goa on Wednesday, reviewed the GST rates for over 100 items, including textiles, handloom goods, agricultural products, fertilisers, and educational materials. However, no consensus was reached on any of the items, with further discussions scheduled for next month in Delhi.
The six-member Group of Ministers (GoM), chaired by Bihar Deputy Chief Minister Samrat Choudhary, will convene in Goa on Tuesday and Wednesday to discuss tax rates for over 100 products, including fertilisers, handloom goods, and textiles, according to sources.
The GST Council is seriously discussing rationalisation, going through GST rates “item by item”, the Union Finance Minister, Nirmala Sitharaman, said in an interaction with the journalists of The Hindu group of publications, on Saturday.
The ministerial panel tasked with GST rate rationalisation will convene on September 25 in Goa to discuss potential adjustments to tax slabs and rates, reports PTI.
Union Finance Minister Nirmala Sitharaman on Monday (September 16) said the Narendra Modi government is exploring further rationalisation of GST rates to simplify the tax structure and potentially reduce rates.
The upcoming Goods and Services Tax (GST) Council meeting on September 9 will discuss rationalisation of rates on several items but a decision regarding any rate change will be taken in subsequent meetings,
The group of ministers (GoM) on GST rate rationalisation may have deferred a plant to rework slabs but it is undertaking a thorough review of rates across several categories, including items in the 12% and 18% brackets and will take a call on several products and services towards Sept-end.