What is the GST Slabs in India Prevalent for Goods Right Now?

Posted by Anika Sharma on December 20th, 2019

The Goods and Services Tax reform divides the tax slab according to the nature of goods in four categories - 5%, 12%, 18% and 28%. It is evident that the goods charged under the minimum tax slab is struggling and the government wants to rescue them by low tax rates. And, some basic goods that people use everyday like milk, spices, tea, etc. should also come under the lowest tax slab. While, luxury items should be charged with high GST rates. There are some items that have been added to the “no tax” slab. These are mostly agricultural items, again, an initiative by the government to give impetus to these industries. Let’s check out what the GST Slabs in  India for different goods are:

No Tax - Cane jaggery (gur), Cereals, Fish (Frozen or not processed), Tender Coconut water, Handloom, Meat, Picture books, colouring books or drawing books for children, Sanitary Napkins, Agricultural implements, Bangles, Postal Items, Firewood or Fuelwood and many more such goods.

5% Tax Slab - Medicines and Drugs, Edible Oil, Tea, Coffee, Milk, coal (for growth of power industries), Sweets, Cashew nuts, Coir mats, matting and floor covering, Pawan Chakki that is Wind-based Atta Chakki, Numismatic coins, Aggarbatti, Natural cork,

Marble rubble, Accessories/parts for carriages designed for differently-abled individuals, Other products for persons with disabilities and many more items.

12% Tax Slab - Medicine,umbrella, Instant food mix, Cell phones,  pickles, Handbags including pouches and purses, ghee, frozen meat products, butter, cell phones, sewing machine, Ornamental framed mirrors, Art ware of iron, etc.

18% Tax Slab - Electrical Transformer, Set top Box for TV, Baby carriages, Used or retreaded pneumatic rubber tires, Power banks powered by Lithium-ion batteries,  mineral water, deodorants, suitcase, briefcase, cookers, stoves, cutlery, telescope, mattress, cartridges, multi-functional printers, doors, windows, aluminium frames,  safety glass, mirror, glassware, sheets, pumps, Refrigerators, Water Heaters, Washing Machines, Televisions, etc.

What differences has the GST slabs in India brought to the Indian economy?

Eliminated the Cascading Effect: The tax on tax effect was the reason for the excruciating prices of goods and services, earlier. With the introduction of Goods and Services Tax, the cascading effect of tax has completely vanished, slowly, getting down the prices of  goods.

One Tax, One Nation: From Kashmir to Kanyakumari, the tax structure will be the same for everyone. Earlier, the tax structure used to vary from state to state. This used to cause chaos in the movement of goods from one state to another, thereby, increasing the cost of production causing a surge in the prices of goods for the final consumer.

Trade: Before the GST slabs in India system, some of the industries were in peril due to the heavy taxation policy. This new tax reform has helped to flourish trade within and outside the country. The exports level have gone up due to tax exemption and a reduction in tax rates. Credit is to be given to the GST Committee, who have sat and discussed about the industries that need immediate attention in terms of tax rates. Some of the industries that are flourishing under the GST regime are the textile and retail industry. Small business owners are paying very less tax rates which were very high, earlier. This has led to better productivity and efficiency.   

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Anika Sharma

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Anika Sharma
Joined: December 16th, 2019
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