Relief for consumers as government slashes GST rates on many products

Following the Goods and Service Tax (GST) Council meeting in New Delhi on Saturday, Interim Union Finance Minister Piyush Goyal announced reduced GST rates for a variety of commodities.

Addressing a presser, Goyal said, "After careful considerations and discussion with the state finance ministers, we (the GST Council) have decided to implement these changes for the welfare of the middle classes and small businesses and traders. Besides revenue collection, the GST council will now focus on job creation as well."

The decisions made on Saturday will be applicable from 27 July.

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Apart from a 100 per cent waiver of GST on sanitary pads, the council has decided to nullify tax on raw materials such as stone, marble and wood, used by for making handicrafts like sculptures. Also, rakhis, sal leaves, the raw materials used to make regular brooms have also been fully exempted from being charged under GST.

The GST charged for commodities such as lithium-ion batteries, vacuum cleaners, food grinders, mixers, storage water heaters, head dryers, hand dryers, paint, varnishes, water cooler, milk cooler, ice cream coolers, perfumes, toilet sprays and other toiletries has been slashed from 28 per cent to 18 per cent.

The GST on handbags, jewellery box, wooden box for paintings, glass art ware, ornamental framed mirrors, handmade lamps, wax, natural gum, iron and brass products have been reduced from 18 per cent to 12 per cent.

The high court bench had said sanitary pads are a necessity, and there cannot be any explanation to tax them and exempt other items by listing them in the category of necessities.The court also expressed its displeasure over the absence of any women in the 31-member GST Council.

The GST on some commodities has been slashed from 18 per cent to five per cent, including ethanol, and solid bio-fuel pellets. Goyal asserted on the importance of reducing the tax on ethanol, as not only is it used for blending with petrol and diesel, it is also vital for the sugar industry, and will thus be very beneficial for the sugarcane farmers.

Various fabrics, like Chenille fabrics, mats made via handlooms, fertilizer-grade phosphoric acid, which were earlier under the 12 per cent bracket, will be charged 5 per cent, while the GST on washing machine reduced from 28 per cent to 18 per cent.