The government, it seems, is not sure whether the prices will jump after the introduction of goods and services tax (GST). The ministry of finance, however, is taking extra effort to keep prices under check. The finance ministry is in the process of identifying the possible prices of 2000-2500 goods and services used commonly with GST and comparing them with prices without the new regime.
This data has been provided with various slabs, which will cover major cities of India. The small urban centers and villages will remain outside the purview of this regime, “We cannot go down to the level of small towns and rural areas, but the price chart will be indicative,” said a senior officer of the Finance Ministry.
Finance Ministry is also taking steps such that GST rates do not cause the prices of major commodities and services to jump. The essential commodities such as food products are given protection and consumer goods such as soaps are given lower levy. The distinction has been made within other product categories too. The multiple slabs are created for hotels and restaurants as well. The cheaper categories of footwear and biscuits are also expected to be curved out as against the more expensive ones.
GST Rates 03/6/2017 Main Highlights
- For gold, the GST has been set at 3 per cent introducing a new tax slab
- GST of 12 per cent will be levied on readymade garments
- Footwear upto Rs 500 is charged at 5% and above it is 18%
- GST on Agri machinery fixed at 5 per cent
- GST on apparel below Rs 1,000 fixed at 5 per cent: Arun Jaitley
- A nominal rate of 0.25 imposed on rough diamond: Arun Jaitley
- 0 per cent tax on Jute: Arun Jaitley
- GST Council will set up committee to look into complaints regarding anti-profiteering clause, said Arun Jaitley
- Bidi to be taxed at 28% without cess. However Beedis are still under discussion, no proposal of cess for beedis: Arun Jaitley
- GST rate for gold fixed at 3 per cent: Arun Jaitley
- Gold, gems, jewellery to be taxed at 3 per cent: Arun Jaitley
- Footwear priced below Rs 500 to be taxed at 5%, the rest at 18%: Arun Jaitley
- Readymade garments to attract 12% GST; Yarn and fabric cotton 5 per cent
The situation and government policies regarding GST is ambiguous and union finance ministry and the state finance that are jointly creating it is not helping it to be more clear to the common man. The incumbent government has been under fire in a number of occasions for being insensitive to the price rise. Will the GST be another instance of price rise amongst stagnant employment scenario that is already hurting the commoners?