And there will be just two GST slabs, 5% and 18% now. Essential commodities such as soap, shampoo, ACs and cars will be affordable with this. This was decided under the 56th GST Council meeting. The information was announced on September 3 by Finance Minister Nirmala Sitharaman.
Sitharaman declared that the GST will be free on food stuffs like milk, roti, paratha and chhena. There will also be no taxation on individual health and life insurance. Also, 33 life-saving medicines will be exempted, along with rare and critical disease drugs.
Fourty percent GST will now be charged on luxury goods and tobacco products (28 percent previously). This slab will include medium- and large cars and motor cycles that have engines with a capacity of more than 350cc.
New slabs to take effect September 22.
According to the Finance Minister the new slabs will come into effect on the first day of Navratri, i.e., September 22. But the new GST rate of 40% on tobacco products will not be applied at once.
These changes are aimed at alleviating the plight of the ordinary individual, helping the small businesses and reducing consumption of hazardous goods such as tobacco by raising the tax.
Hotel room bookings to be cheaper, IPL tickets to get costlier
Hotel room reservations attract a GST of 5 percent (previously paid 12 percent) provided the room rent is 7,500/day or below.
GST charged on beauty and health-related services like gyms, salons, barber shops and yoga centres, which people frequently use, has been cut to five percent instead of 18 percent.
GST on casinos, race clubs, combined casino-race club facilities and entry to sports events like the IPL has increased to 40 percent.
These reforms will make the life of citizens better: PM.
On X, PM Modi stated that he was pleased that this proposal by the central government was approved by the GST Council. It involves the lowering of GST and a number of reforms. This will be helpful to the common people, farmers, MSMEs, the middle class, women, and the youth. These significant shifts will enhance the quality of life of citizens and will simplify business. Smaller traders and businesses will in particular be of benefit.
