The Goods and Services Tax (GST) panel in its 25th meeting on Thursday, January 18, decided to reduce the tax rate on 29 items and 54 services. The new rates would be effective from January 25.
The GST Council headed by Finance Minister Arun Jaitley also decided to simplify the GST return filing process for businesses.
The government slashed rates on 20-litre packaged drinking water, biodiesel, diamonds and precious stones, sugar candies, tailoring services, amusement parks and low-cost housing construction services.
Here are the main takeaways from GST council decisions:
- The council slashed taxes on packaged 20-litre water bottles from 18 percent to 12 percent.
- GST rates for buses that run on biofuels which are used for public transport are to be reduced from 28 percent to 18 percent. Old and used vehicles also fall under this limit.
- The panel recommended reducing GST rate from 18 percent to 12 percent for metro and monorail projects which includes construction, erection, commissioning or installation of original works.
- The government will cut taxes on mining or exploration services of petroleum crude and natural gas and for drilling services in respect of the said goods.
- A rate cut from 18 percent to 5 percent for tamarind, kernel powder, Mehendi paste in cones, and LPG supplied for supply to household domestic consumers was also decided upon.
- Rates were slashed from 12 percent to 5 percent for articles of straw, esparto or other plaiting materials used in basketware.
- GST rates were slashed on common effluent treatment services from 18 percent to 12 percent.
- The panel at its next meeting may also consider bringing petroleum and real estate under the GST regime.
- In the service segment, GST rates on services by way of admission to theme parks, water parks, joyrides, merry-go-rounds, go-carting and ballet have been reduced from 28 percent to 18 percent.
- There will be no GST for Vibhuti, parts and accessories for the manufacture of hearing aids and de-oiled rice bran.
- The e-Way bill system will be implemented from February 1 for moving goods of over Rs 50,000 in value between states.
- Supply of services for providing information under RTI Act, legal services provided to government, local authority, governmental authority and government entity, transportation of goods from India to outside by air and sea, etc, are now exempted from GST.
- Exemptions from GST have also been given to services relating to admission or conduct of examinations provided to all educational institutions, entrance fees of the entrance examination and for transportation of students up to higher secondary schools.