GST Council and GST Rate Slabs

Advocate Anandaday Misshra

On 18th October 2016, the Central Government has proposed various rate slabs in GST Council. It must be noted that the GST Council is meeting from 17th – 19th October 2016 to finalise GST rate slabs, Cess & concessions along with compensation to various states.

GST Rate Slabs – The proposed GST rates  are as below :

i. 6% – Food items and other necessities.

ii. 12% – Substantial Goods & Services

iii. 18% – Rest Of Goods & Services

iv. 26% – Luxury goods

v. 4%- Precious metals like gold .

Cess

Additionally, Cess has been proposed for demerit goods included selected luxury cars, tobacco , pan masala etc towards compensation to states.

Crucial Discussions

The following crucial discussions also hint a lot on GST rate structure  :

a. Concept of High GST Rate Limit – Highest Rate Limit Proposal @ 30%came from Kerala Finance Minister Thomas Issac with a condition that  state government can either  exempt or levy lower tax rates even highest slab is fixed.

b. Food Items– Special treatment to certain food items is likely to continue and it will be exempted from the tax as well.

c. Common Usage– 50 per cent of the items of common usage will be exempted.This will be also a measure to check inflation.

Average GST Rate For Goods & Services

Goods – Average GST rate seems to be @ 6% & 12 % . Whereas, FMCG products shall attract GST rate @ 26% .

Services – GST rate may be @ 12% or 18% .

For an advance level understanding of GST , keep referring www.gstprofs.in .

(The author is one of the leading litigation and advisory advocate.  He is an eminent speaker and author on various laws including GST. He handles cases in various Tribunals  & High Courts of India. He can be contacted on anand@amlegals.com. For more, please refer www.amlegals.com )

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