Govt proposes 5% and 18% GST slabs, tobacco & pan masala at 40%: Reports
The Goods and Services Tax (GST) structure is all set for a major overhaul, with the government proposing two tax slabs of 5% and 18%, as reported by various sources. The reports also suggest that sin goods like tobacco and pan masala will be slapped with a 40% GST. This proposal has been sent to the GST Council for further deliberation and implementation.
The 5% tax slab is likely to be applicable to essential goods and services, such as food items, healthcare, and education. This move is expected to provide relief to consumers and small businesses, which have been struggling with the current GST regime. The 18% tax slab, on the other hand, may be applicable to non-essential goods and services, such as luxury items, entertainment, and travel.
The proposal to increase the GST on sin goods like tobacco and pan masala is a significant one, as these products are notorious for their negative impact on public health. Raising the tax on these products is expected to reduce their consumption and increase government revenue. This move is also seen as a step towards promoting a healthier and more responsible lifestyle.
The GST Council, which is a constitutional body responsible for making decisions on GST rates and regulations, is expected to deliberate on the proposal and make a final decision. The Council is composed of representatives from the central government and state governments, and its decisions are binding on all states.
The proposal to overhaul the GST structure comes at a time when the economy is facing significant challenges, including a slowdown in growth, high unemployment, and declining consumer demand. The government is under pressure to take steps to boost economic growth and increase revenue, and the GST overhaul is seen as a key step towards achieving these goals.
The current GST regime, which was introduced in 2017, has been plagued by problems, including a complex tax structure, high compliance costs, and frequent rate changes. The government has been under pressure to simplify the tax structure and reduce the burden on businesses and consumers.
The proposal to introduce two tax slabs of 5% and 18% is seen as a step towards simplifying the GST structure and reducing the burden on businesses and consumers. The 5% tax slab is expected to provide relief to small businesses and consumers, while the 18% tax slab will help the government increase revenue.
The government has been working on a number of initiatives to boost economic growth and increase revenue, including the overhaul of the GST structure. Other initiatives include the introduction of a new income tax regime, the reduction of corporate tax rates, and the increase in government spending on infrastructure and social welfare programs.
In conclusion, the proposal to introduce two tax slabs of 5% and 18% under the GST regime, along with a 40% tax on sin goods like tobacco and pan masala, is a significant step towards simplifying the tax structure and increasing revenue. The government is expected to implement this proposal in the coming months, and it remains to be seen how it will impact the economy and businesses.
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