GST Rate cut news: Common people are going to get some good news from the first day of Navratri, i.e. 22nd September. Actually, the new rates of Goods and Services Tax (GST) will be effective from this date.
As such, products ranging from everyday items to insurance, cars-bikes, cement etc. will become cheaper. Now the Finance Ministry has notified the new GST rates. After this notification, the states will also have to notify the State GST (SGST) rates at their level. Please note that the revenue earned under the GST system is shared equally between the Centre and the states.
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What has changed
After the approval of the GST Council, from September 22, under the new system, most of the goods and services will be taxed at the rate of 5 and 18 percent. However, 40 percent tax will be levied on luxury goods, whereas cess along with 28 percent GST will continue on tobacco and related products. Let us tell you that under the current system, there are four GST rates which are 5, 12, 18 and 28 percent. Along with this, a separate cess is also levied on luxury and harmful products.
What do experts say?
Experts believe that with the reduction in tax rates on most items, it is now the responsibility of the trade and industry to pass on the benefits of these amendments to consumers and ensure timely compliance. Rajat Mohan of AMRG & Associates said that the government has clarified the situation by issuing clear rate schedules in the notification and now the industry will have to implement it quickly.
Saurabh Agarwal, Tax Partner at EY, said that after the notification regarding the rate revision is issued, companies should immediately focus on passing on the benefits to consumers by making changes in their centralized management system ERP and pricing policies.
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