SRINAGAR: The all-powerful GST Council on Thursday finalised tax rates for services under the Goods and Service Tax (GST) regime, scheduled to kick-in from July 1.
The tax rates for services will be 5, 12, 18 and 28 percent - in line with those applying to goods. The council will meet again on June 3.
"The net effect of Goods and Services Tax will not be inflationary," Jaitley told reporters after a meeting of the GST Council in Srinagar, summer capital of Jammu and Kashmir state.
The council, comprising federal and state finance ministers, fixed rates for more than 1,200 items under the GST, amid demands by some states to keep essential items under the lower tax category.
Here's all you need to know:
- Telecom, financial services to attract GST of 18 per cent
- Entertainment tax will be merged with service tax under GST and a composite 28 per cent levy charged on cinema services as well as gambling or betting at race course
- The tax rate on gold has not been finalised yet
- Five per cent GST to be levied on cab aggregrators like Ola and Uber
- AC restaurants and those with liquor licence to charge 18 per cent GST; 5-star hotels to levy 28 per cent
- Healthcare and education would be exempt from GST.
- Economy class air travel to attract 5 per cent GST; business class 12 per cent
- Travelling on metro, local train, religious travel, Haj yatra will all be exempt from GST
- Work contracts like white washing will be liable for a 12 per cent GST
- Hotels and lodges charging per day tariff of Rs 1,000 will be exempt from GST. Rate for hotels with tariff of Rs 1,000 to 2,000 per day would be 12 per cent while those with tariff of Rs 2,500 to Rs 5,000 would be 18 per cent. GST for hotels with tariff above Rs 5,000 will be 28 per cent
- There will be no tax on lottery
Basic food items like cereals, eggs and meat will attract zero tax while processed food items will be charged between 12 and 28 percent. READ MORE
Jaitley said tax on gold and precious metals will be taken up at the next meeting of the Council on June 3
Separately, Revenue Secretary Hasmukh Adhia said e-commerce players like Flipkart, Snapdeal will have to deduct 1 per cent tax collected at source.
(With inputs from PTI, Reuters)