GST may have less tax slab rates says Finance Minister Arun Jaitley

GST slab rates are of four types that are 5 %, 12 %, 18 % and 28 % and Government of India announced these new GST tax slab rates on 1 July 2017 only. Even GST Council approved these four new Goods and Services Tax slab rates for current financial year. However now there can be some more changes in GST slab rates as even Finance Minister Arun Jaitley said that GST Council is considering a change in slab tax rates.

Changes in GST

Currently there are four slab rates apart from some products being in exempt list. And if you look at Goods and Services Tax rates with earlier taxes then there is a lot of difference between the two. It is so because in tax exempt list only a total of 7 % products are there. On other hand there are about 14 percent products in 5 % tax bracket, while only 17 percent products fall in 12 % tax bracket.

Due to this in 18 % GST slab rate about 43 percent products are there whereas in case of 28 % tax bracket there are only 19 percent goods and services. Hence there is a lot of difference in products list.

You can also check out another article on what will be GST cess on luxury cars, SUVs, mid and large – size cars.

Before and after GST

Before implementation of GST tax rates there were many products in high tax rates. On an average there were 35 % products having 27 percent tax or more than that. But after GST very few products are having high tax; so this is the reason that GST Council and Government of India is considering about adding up two tax rates.

Combination of tax slab rates

Though Finance Minister Arun Jaitley said that authorities may add or combine two slab rates but he clarified that they will take time to implement this step. As main aim of Government is to make things easier for all people. Authorities would also consider as to how much time it takes for people to understand complete GST process.

12 % and 18 % GST rates to combine

Mr. Jaitley, the Finance Minister of India further added that 12 % and 18 % are most likely tax slab rates to combine. This combination would also not be a trouble to people as it is going to be smooth transition of taxes which will definitely benefit tax payers.

Recently Indian Government also released a notification about reduction of GST on digital payments as well so that people move towards digital payments. While it is now to see as to what will be result of this combination of GST tax slab rates in near future.

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