GST council exempts Khadi yarn, Gandhi topi, national flag from tax
Khadi yarn, Gandhi topi, India's national flag will not attract any tax under the GST regime, while imitation jewellery, pearls and coins will carry 3 per cent levy from the next month.
Besides, the GST Council on Saturday decided to include rudraksh, wooden khadau, panchamrit, tulsi-kanthi mala, panchgavya, sacred thread and vibhuti – sold by religious institutions – in the definition of 'puja samagri' and maintained that these items would be exempt under the Goods and Services Tax (GST).
Also chandan tika, unbranded honey and wick for diya have been exempt under the new indirect tax regime, which is scheduled to kick off form July 1.
However, five 'puja samagri' – lobhan, mishri, batasha and bura – will attract 5 per cent GST. In the textiles category, blankets and travelling rugs, curtains, bed linen, toilet linen and kitchen linen, of terry towelling or similar terry fabrics costing below Rs 1,000 will attract a 5 per cent tax.
Also napkins, mosquito nets, sacks and bags, life jackets costing below Rs 1,000 would be taxed at 5 per cent.
While those costing above Rs 1,000 will attract a 12 per cent levy. Silk and jute yarns have been exempt but cotton and natural fibres and all other yarns will be levied a 5 per cent GST rate. Manmade fibres will, however, attract 18 per cent rate.
All categories of fabric, except khadi yarn which has been exempt, will attract a 5 per cent rate. Gandhi topi and India's national flag, however, have been exempt from tax under the GST.
Manmade apparel costing below Rs 1,000 will attract 5 per cent tax, lower than the existing 7 per cent. Those costing above Rs 1,000 will continue to attract 12 per cent. Besides, match boxes, packed organic fertiliser will face a 5 per cent tax in the new regime. The GST Council, comprising Finance Minister Arun Jaitley and his state counterparts, has already fitted almost all goods and services in the tax brackets of 5, 12, 18 and 28 per cent. The tax department has also put up on its website the list of items which would be exempt from the Integrated GST (IGST) under multilateral or bilateral commitments in respect of imports by privileges persons, organisations, authorities and foreigners. The IGST is a tax which will be levied by the Centre on inter-state movement of goods and services. It is not a new tax since the credit for IGST payment can be claimed while paying the CGST or SGST. Foodstuffs, medicines, medical stores of perishable nature, clothing and blankets, imported by a charitable organisation as free gift to it from abroad and meant for free distribution to the poor and the needy have been exempt from the IGST.
Besides, goods imported by the Red Cross Society for purposes of relief to distressed persons, and drugs, medicines and medical equipment required for the treatment of the victims of the Bhopal Gas Leak disaster has also been exempt.
Also fuel in the tanks of the aircraft of an Indian airline or of the Indian Air Force subject to the condition, that the quantity of the said fuel is equal to the quantity of the same type of fuel which was taken out of India in the tanks of the aircraft of the same Indian airline or of the Indian Air Force, has been exempt from the IGST.
Besides, exemptions have been given for research equipment imported by public funded research institutions or a university or an Indian Institute of Technology or Indian Institute of Science, Bangalore or Regional Engineering College, Research institutions, other than a hospital, Departments and laboratories of the Central Government and State Government, other than a hospital, and Regional Cancer Center (Cancer Institute).
Govt starts GST awareness drive for consumers
The government has started its media blitzkrieg to tell the common man that the upcoming GST will reduce prices of most goods. The Central Board of Excise and Customs (CBEC) in advertisements in leading dailies gave pictorial representations of items which are exempt from Goods and Services Tax and the ones which would attract lower tax of 5 per cent.
The GST Council, chaired by Finance Minister Arun Jaitley and comprising his state counterparts, has already decided on tax rates of majority of the commodities. They have been put in slabs of 5, 12, 18 and 28 per cent, with the exception of gold which will attract 3 per cent GST. GST, which will subsume 16 different levies, will be rolled out from July 1.
The CBEC said salt, milk, gur, egg, curd, unpacked food grain and paneer, fresh vegetables, unbranded atta, maida, besan, honey, besides education and health services have all been exempted from GST. "GST-Single tax to reduce prices of most products of mass consumption," it said. In an interview to PTI last month, Revenue Secretary Hasmukh Adhia had said that the government will launch a massive awareness campaign to educate consumers about GST so that they are not fleeced by traders in name of the new tax.
"Because we have taken care to ensure that the average tax incidence on commodities does not go up...there may be some traders who will try to tell the consumers that under the changed GST rates they will have to pay more. We have to educate them," Adhia had said.
Textile exporters' bodies welcome reasonable rates
Coimbatore: Major textile industry bodies on Sunday welcomed the decision of fixing reasonable GST rates to most of the categories and thanked Union Finance minister, Arun Jaitley for initiating faster decisions on the subject.
In his reaction, Regional Chairman Federation of Indian Exporters' Organisation (FIEO) Southern Region, A Shaktivel said that the lower GST rates across the products which are having high export potential will go a long way in promoting "Make in India".
The leather and footwear sector, Pharmaceuticals, food products, textiles got fair deal in taxation, Sakthivel said in a statement here.
On textile, he said that announcement of lower rates of GST for Fabrics, Natural Fibre, Apparels and Made-ups will enable increased value addition, employment and exports and propel domestic production across the sectors.
Sakthivel also said that the simplified procedure of job works by allowing movement of goods by Challan only will go a long way in developing supporting eco system much needed for garment industry s competitiveness.
Indian textile industry estimated at 120 Billion Dollars worth today, can reach 230 Billion Dollars by 2020, if further focus was given, so that export of raw materials including fibre and yarn can be replaced with more value added products.
Tirupur Exporters' Association (TEA) also thanked Jaitley for considering the requisition and helping to fix GST rate at five per cent for garments including cotton, cotton yarn and fabrics.
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