India Tax and advisory, business entry and consulting services

GST Tax Rates Finalized

The Honorable Finance Minister has today announced four tier GST tax rates (five if zero rate is included) structure for the Goods and services tax (GST) that is proposed to come into effect from the 1st of April 2017.

As had been discussed earlier the proposed GST rates are :

GST Tax Rates

Essential Commodities 0%
Items of Mass Consumption 5%
Standard rate Slab 1 12%
Standard Rate Slab 2 18%
Demerit Goods/Luxury Items 28%

While the multiple rates are bound to come in for criticism, Pallav Pradyumn Narang, a partner with our firm had argued that they would not have an adverse impact on trade and compliance. We echo this sentiment insofar as the GST tax rates and multiplicity of slabs is concerned. We however harbor reservations with respect to the proposed cesses on such slab based rates.

A 4% levy of GST on Gold has been proposed but has not been crystallized as of this moment.

Comments are closed.