New GST rates come into effect from today; 177 items get cheaper

Henrietta Brewer
November 15, 2017

Eating out to become cheaper from Wednesday after the GST Council Meeting led by Finance Minister Arun Jaitley revised the rates of the new national tax on November 10. The Council also recommended that the eligibility threshold for the composition scheme be raised to '1.5 crore from '1 crore, and manufacturers, restaurants and traders under the scheme be levied a uniform 1 per cent tax from the earlier differential tax slabs.

However, from today, all restaurants outside high-end hotels charging over Rs 7,500 per room will uniformly levy GST of 5 percent. All these got input tax credit, a facility to set off tax paid on inputs with final tax. As the GST on value of food bill has been brought down to five percent from the huge slab of 18 per cent, people can really step out and enjoy their meals at AC and Non-AC restaurants, without feeling the unnecessary pinch on their wallets. The union government has chose to cut GST rates on restaurants after the price hike in food triggered protest among the public.


In a major revamp of the GST tax structure, the GST Council also removed 178 items from the highest 28 percent category.

The GST Council, during its meeting last Friday in Guwahati, had recommended that GST rates on almost 210 items, 180 of them in the top 28 per cent tax bracket, be slashed. "Since they did not pass on the ITC benefit to customers, they will not be eligible for the benefit themselves", Jaitley had said.


According to the notifications, the GST has been cut on a host of consumer items such as chocolates, chewing gums, shampoos, deodorants, shoepolish, detergents, nutritional drinks, marble, and cosmetics. He clarified that it was not that all the items from the 28% tax bracket could come down as there were many luxury goods in that bracket and from there the government ensured revenues.

Among mass consumption items watches, blade, stove, mattresses have been reduced to 18 percent from 28 percent. It decided that filing GSTR 3B would continuing till March 31, 2018.


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