GST slashed: Sanitary pads, footwear, small TVs among 100 items impacted

GST slashed: Sanitary pads, footwear, small TVs among 100 items impacted

Delhi Deputy Chief Minister Manish Sisodia and Maharashtra Finance Minister Sudhir Mungantiwar announced this on Saturday after a meeting of the GST Council. Tax exemptions mean there would be no input tax credit available, even though inputs in the production of sanitary napkins are taxed. He said, lithium-ion batteries, vacuum cleaners, food grinders, mixers, storage water heaters, hair dryers, hand dryers, paint, varnishes, water cooler, milk cooler, ice cream coolers, perfumes, toilet sprays and toilet preparation have been brought to 18 from 28 per cent slab. "Rakhis have been exempted from GST, tax on ethanol has been cut to 5 percent, small handicrafts have been exempted", Finance Minister Piyush Goyal told reporters during the press briefing.

GST on handmade carpets and handmade textile floor coverings has been reduced from 12 per cent to 5 per cent.

George Osborne announced as far back as 2016 that the government would seek to abolish the "tampon tax" but Britain now remains tied to European Union rules.

"Out of the 49 items now taxed at the highest rate of 28%, rates on 17 have been reduced to 18%", Pratik Jain, partner & leader, indirect tax, PwC, said in a note. They launched the viral campaign #lahukalagaan (tax on blood), which had the support of comedians like Kaneez Surka, Mallika Dua and actor Aditi Rao Hydari.

Previously there were around 226 goods in the 28 per cent category when GST was implemented on July 1, 2017. If the sanitary napkins are technically under GST, but taxed at 0%, manufacturers will still be able to get input tax credits.

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"Today's decisions of the GST Council were guided by simplification, rationalisation..."

The new tax rates will come into effect from July 27. This, a report by Hindustan Times, said was in addition to the composition scheme, which allows small tax payers with sales of upto Rs 1 crore in most of the states, to pay taxes and file returns on a quarterly basis. "Over 90 per cent of small businesses would be benefited as quarterly filing of returns for those with a turnover of up to Rs 5 crore has been prescribed against the present monthly returns, thus, paving the way for a reduction in the compliance burden of the industry", Mahesh Jaising, partner of Deloitte India, said.

"This is a major step towards rationalising the 28 per cent tax slab, which has been narrowed to only a few commodities in the past 13 months", Jaitley tweeted. "The decision has been taken by GST Council in which congress led governments are also involved".

Other than sanitary napkins, rakhi too has been made GST free. The Council will meet next on August 4. With the stabilisation of revenue, the rate on many items were gradually reduced.

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