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| GST council meeting led by Nirmala Sitharaman |
Finance Minister Nirmala Sitharaman led the 56th GST Council meeting which lasted 10.5 hours made some changes in the eight-year old indirect tax regime. They decided to reduce from four-slab structure to two-slab structure i.e. 5% and 18% with a demerit rate of 40% on the item of Luxury, harmful product and demerit goods.
The main aim for this decision is to lower the tax burden on common people, to ease the blocked working capital and to make it easy to business.
According to the FM Nirmala Sitharaman who chaired the meeting which was attended by many ministers of states and Union Territories, all the changes in the rate will come in effect on the first day of Navratri which is on September 22, except for the harmful product.
According to the statement from PMO, Prime Minister Narendra Modi expressed his happiness that GST Council had agreed to the proposals submitted by the Union Government on GST rate cuts and reform, which will give relief from tax burden for common people, farmers, MSME's, middle-class, women and youth.
PM said"The wide ranging reforms will improve the lives of our citizens and ensure ease of doing business for all, especially small traders and businesses."
Impact of GST rate cut on items.
- Impact on Phones and Laptop
As of now there are no changes in the phone and laptop. Government has decided to keep the 18% slab on phone and laptop as before. Which means there will be no price reduction on phones and laptop
- Impact on TV's, AC's and dishwasher
The Government has shifted the tax slab for TV's, AC's and dishwashers machinery from 28% to 18% under the latest GST reform. Meaning there will be some price change in TV"s, AC's and dishwasher machinery's. According to some reports air-conditioners maybe cheaper by 1000-2000 rupees
- Impact on Health and Life Insurance Premiums, Medicine and Medicine devices
In Health and Life Insurance Premiums, Government has decided to reduce the GST slab From 18% to zero and on 33 Life-Saving drug and medicine has been reduced from 18% to NIL. 3 Life-Saving drug for Cancer and rare diseases has been reduced to NIL from 5%, On all other medicine it has been reduced to 5% from 12%. And on medical devices it has been reduced to 5% from 18%.
Finance Minister stated that Prime Minister Narendra Modi's vision for future next generation of tax reform has led to people receiving benefits sooner. She also said that government has corrected inverted structure issues, resolving classification method and has been working to make GST regime more stable.
The 56th GST Council meeting, chaired by the Nirmala Sitharaman India's Finance Minister took place in New Delhi. The council discussed upcoming GST reforms, simplifying compliance nad making tax rate more rational to help common people of India.