Union Finance Minister Arun Jaitley along with MoS for Finance Shiv Pratap Shukla and Finance Secretary Hasmukh Adhia (L) at the 23rd GST Council Meting, in Guwahati on Friday. PTI

Guwahati, November 10

The GST Council on Friday decided to reduce tax rate on a wide range of mass use items — from chewing gums to detergents — to 18 per cent from current 28 per cent, Bihar Deputy Chief Minister Sushil Kumar Modi said.

The all-powerful council pruned the list of items attracting the top 28 per cent tax rate to just 50 from 227 previously, Modi told reporters here.In effect, the council, in its 23rd meeting on Thursday, cut rates on 177 goods.Facing intense heat from opposition-ruled states over keeping mass used goods in the 28 per cent bracket which was meant for luxury and de-merit goods, the Council pruned the list to 50 as against 62 that was recommended by its fitment committee.The Goods and Services Tax (GST), implemented from July 1, has five tax slabs: 0 per cent, 5 per cent, 12 per cent, 18 per cent and 28 per cent.”There were 227 items in the 28 per cent slab. The fitment committee had recommended that it should be pruned to 62 items. But the GST Council has further pruned 12 more items,” Modi said.He said all types of chewing gum, chocolates, preparation for facial make-up, shaving and after-shave items, shampoo, deodorants, washing powder detergent and granite and marble will attract lower 18 per cent tax rate.”There was unanimity that in 28 per cent category there should be only sin and demerit goods. So, today the GST Council took a historic decision, that in the 28 per cent slab there will be only 50 items and the remaining items have been brought down to 18 per cent,” he said.Paints and cement have been retained in the 28 per cent tax bracket, he said.”Luxury goods like washing machines and air conditioners have been retained at 28 per cent.”The decision taken by the GST Council will have a revenue implication of Rs 20,000 crore annually.”There is consensus that slowly 28 per cent slab should be brought to 18 per cent. But it will take some time because it has a big revenue implication,” he said. PTI

Panic-stricken’ Modi govt has no option but to change GST rates: PC

P Chidambaram. File photo

New Delhi, November 10Congress leader P Chidambaram on Friday said a “shower of changes” is expected from the GST Council meeting in Guwahati and the “panic-stricken” Modi government had no option but to change the new tax rates.The high-powered committee headed by Union Finance Minister Arun Jaitley is meeting in the Assam city to discuss GST rates.Chidambaram said the government would be forced to heed the advice of the opposition and experts due to the Gujarat Assembly elections next month.“Expect a shower of changes in GST rates from GST Council meeting today. Panic-stricken govt has no option but to concede demands for change.

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“Thanks to Gujarat elections, government forced to heed advice of Opposition and experts on flaws in implementation of GST,” he tweeted.Chidambaram said the letter from the finance ministers of Congress-ruled states to Jaitley would set the tone for discussions in the GST Council on Friday.“Congress FMs’ letter exposes the structural flaws in the design and implementation of GST. Government can no longer duck these issues,” he said.The Congress leader said the government had avoided debate and voting in Rajya Sabha on GST Bills but it could not avoid a debate in the public domain or in the GST Council.“Congress FMs will force changes in GST Council meeting today. Agra, Surat, Tiruppur and other hub towns are watching,” he said.The finance ministers of Congress-ruled states last week demanded a major overhaul of the Goods and Services Tax (GST), alleging that the tax reform measure had turned out to be a “big disappointment” due to its “poor” implementation.The finance ministers of the Congress-ruled Punjab and Karnataka, Manpreet Badal and Krishna Gowda, alleged that the country had “lost the opportunity” to bring tax reform and that there was “utter chaos and confusion”, forcing many businesses to shut down.They also alleged that there was “poor implementation” with regard to GST’s concept, design, tax rates, exemptions, compliance requirement and technological preparedness.They said the party would demand reduction of tax rates for many items and raise other concerns of the business community in the Guwahati meeting of the GST Council. PTI