The Parliament passed the GST constitutional bill in august 2016 which carved way for a uniform indirect tax regime in the country. The law will give unparalleled powers to the Centre in collecting indirect taxes in the country and is expected to increase the government revenue by improving the compliance rate. Take a look at how GST will affect the common man:-* The GST Council has agreed upon a tax structure under GST with tax slabs of 5 per cent, 12 per cent, 18 per cent and 28 per cent respectively.
* The GST Council has agreed upon a tax structure under GST with tax slabs of 5 per cent, 12 per cent, 18 per cent and 28 per cent respectively.
* Various goods under GST are expected to be made cheaper under four-slab tax structure.
* Essential items including food constituting around half of the consumer inflation basket will be taxed at zero rate, according to sources.
* For common use items, the lowest rate of 5 per cent would be applicable.
* The services would be charged at 18 per cent most probably which will make eating out in air conditioned restaurants, DTH and mobile services cheaper.
* For items that are taxed at 30-31 per cent,the higher rate under GST is likely to be applicable.
* Tax rate that has to be charged on gold is not yet finalised by the government.
* Several manufactured items including most white goods (example- refrigerator, washing machine etc.)are taxed at an excise rate of 12.5 per cent and VAT of 14.5 per cent and these items are taxed at a combined 30-31 per cent along with cascading effect. These goods will be taxed at 28 per cent.
* Tax would also be levied on products such as tobacco, luxury cars and aerated drinks on top of 28 per cent tax bracket.