New Delhi: Tax rates for as many as 66 items including kitchen staples like pickles and mustard sauce under the ensuing GST regime were cut on Sunday to meet demands from various quarters as the country prepares for rollout of one- nation-one-tax regime in less than three weeks.
Within weeks of the GST Council fitting over 1,200 items into one of the 5, 12, 18 and 28 per cent tax slabs, there were complaints from various quarters about high tax incidence on various goods and services.
The GST Council, which met for the 16th time on Sunday, took up demands for revision in tax rates of 133 items but reduced it only for 66, including agarbatti, computer printers, cashews, children drawing books and school bags.
In a relief to SMEs, the Council also increased the threshold of turnover for businesses which can opt for composition scheme to Rs 75 lakh, from Rs 50 lakh proposed earlier.
Now traders, manufacturers and restaurant owners with turnover below Rs 75 lakh can opt for the composition scheme and pay taxes at 1, 2, and 5 per cent rates respectively.
Jaitley said there were two objectives behind lowering the threshold.
“We tried to maintain revenue neutrality to the extent possible because this can also mean some loss of revenue but it eases the burden on SMEs and small traders, restaurants. And it also reduces the burden on these three categories because these are mass job creators,” he said.
As per the revised tax rates decided by the Council, movie tickets costing up to Rs 100 will attract 18 per cent tax, as against 28 per cent proposed earlier. Those above Rs 100 will continue to attract 28 per cent GST.
Packaged food items like fruits and vegetable products, pickles, murabba, ketchup, mustard sauce, topping spread, instant food mixes and chutney, will attract 12 per cent GST, as against 18 per cent proposed earlier.
