NEW DELHI: The GST Council on Thursday approved seven rules of the goods and services tax (GST) and the remaining two rules relating to transition and return are being vetted by the legal committee, Union Finance Minister Arun Jaitley said.
According to him, in the meeting held in Srinagar on Thursday, out of 1,211 items, GST rates on all barring six have been decided. On Friday, the GST Council will discuss the rates on services and may meet one more time if the tax rates for all items are not decided by then, Jaitley told reporters.
Jaitley is hopeful that the GST Council will be able to reach a consensus to finalise the list of exempted items on Friday, including tax rate of gold and bidi.
“Nearly 81 per cent of the items will fall under below-18 per cent GST rate slabs and only 19 per cent of the goods will be taxed above 18 per cent,” Revenue Secretary Hasmukh Adhia said.
Hair oil, soap, tooth paste will attract 18 per cent tax under GST, while sugar, tea, coffee and edible oil will attract a five per cent tax as would be coal which currently attracts a tax of 11.69 per cent. Milk will be exempt from GST and food grains will be cheaper, Adhia added.
Smalls cars will be charged one per cent cess on top of 28 per cent tax, while mid-sized cars will attract three per cent cess and luxury cars 15 per cent on top of peak rates.
Jaitley said the focus of Thursday’s meeting was on fitment of goods under slabs. It has been decided that the rate for capital goods and industrial intermediate items will be taxed at 18 per cent.
He said the GST Council has begun discussion on the list of items that will attract zero per cent tax. States sought to have the lowest GST for goods sensitive to their states. Uttar Pradesh wants puja material out of tax net, while other states want exemption for certain other products.