Gujarat Global News Network, New Delhi
Eating out in restaurants will be cheaper now as the GST council on Friday fixed 5% rate for restaurants which don’t claim tax credit. Out of the 228 items in 28% bracket 178 have been put in lower bracket.
Finance Minister Arun Jaitley announced this after the meeting of the GST council. He said that the new rates will be applicable from Nov.15. Detergent, marble floorings, toiletries, chocolates, chewing gum and marble have been shifted to 18% tax bracket from 28%.
Jaitley said that tax rate on two items have been reduced from 28 to 12%, 13 items have been reduced from 18% to 12% while the rate on six items have been cut from 18% to 5% and that of eight items from 12% to 5%. Six items have gone from 5% to zero.
For restaurants and hotels, the Council has fixed rate for restaurant at flat 5% who don’t claim tax credit (including ac/non ac), while outdoor catering at 18%. Rate for hotels below Rs 7,500 room fixed at 5%.
Paints, cement have been retained at 28 per cent, he added. Luxury goods such as washing machine and air conditioners have been retained at 28 per cent. Cess on goods such as luxury, sin and whitegoods have been retained at 28 per cent.
But mass consumption items have been lowered to 18 per cent , Modi said.
Tax rate on fire extinguisher, watches, blade, stove, mattress has been reduced to 18 per cent from 28 per cent.
GST rate on fly ash and fly ash brick reduced to 5 per cent from 18 per cent. Rate on pasta, jute and cotton hand bags cut to 12 per cent from 18 per cent.
The decision taken by GST Council will have a revenue implication of Rs 20,000 crore, Modi added. “There is a consensus that slowly, the 28 per cent slab should be brought to 18 per cent. But it will take some time because it has a big revenue implication,” he said.
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