GST rates for gold, garments, footwear out. Here’s how much you have to pay

The Centre finalised on Saturday goods and services tax (GST) rates for items such as gold, packaged food, biscuits, footwear and solar panels – besides some pending rules – paving the way for the country’s biggest tax reform from July 1.

The GST Council has tried to keep the tax rates low for most items because the Narendra Modi government wants to discourage inflation and nurture economic growth, which slipped to 7.1% in 2016-17 from 8% a year ago.

THE NEW FIGURES UNDER GST

• The new regime will have four slabs of 5%, 12%, 18% and 28%
• Packaged food has been fixed at 5%, while biscuits will be taxed at 18%
• Gold will be taxed at 3% as against the current tax incidence of 2-6%
• Apparel costing below Rs 1,000 will be taxed at 5%
• Footwear below Rs 500 will be taxed at 5% while the rest would come in the 18% bracket.
• Beedi and beedi leaf will not attract a cess over and above the tax of 28%
• Most food items – including wheat, rice and milk excepted from the tax bracket
• Sugar, tea, coffee and edible oil, would attract 5% tax
• GST Council decided the tax rates for 1,200 goods and 500 services

The council will meet again on June 11 to complete all the processes required for a smooth rollout. The new regime will have four slabs of 5%, 12%, 18% and 28%, with the intention of unifying the nation into a single market.

Union finance minister Arun Jaitley said the GST rates for packaged food has been fixed at 5%, while biscuits will be taxed at 18%. Gold will be taxed at 3% as against the current tax incidence of 2-6%, varying from state to state, while it will be 0.25% for rough diamonds.

“Gold currently has an excise rate of 1% and states charge 1% VAT... keeping these taxes in mind, and after a lot of debate in the GST Council, we have reached a consensus on 3% for gold and gold jewellery,” Jaitley told reporters after a meeting of the GST Council.

Silk and jute will be exempt, but cotton and natural fibre will be taxed at 5%, man-made fibres at 18%, and apparel costing below Rs 1,000 will be taxed at 5%. Footwear below Rs 500 will be taxed at 5% while the rest would come in the 18% bracket.

with thanks : Hindustan Times : LINK : for detailed news.