CHENNAI: The GST Council is expected to meet within the next fortnight two weeks to consider a proposal to reduce the tax rate on air and water purifiers, a move that could make these products more affordable amid growing public health concerns. Official sources quoted in reports indicated that the issue has gained urgency and is likely to be taken up for discussion by the Council, which brings together the Union finance minister and state finance ministers to take decisions on indirect taxation.
At present, air and water purifiers attract an 18% goods and services tax (GST), placing them in the same bracket as several discretionary consumer durables. The proposal under consideration involves lowering the tax rate, potentially to the 5% slab, by treating these products as essential or health-related items rather than luxury goods. If approved, the reduction could lead to a noticeable drop in retail prices, improving access for households facing poor air quality and limited availability of safe drinking water.
The move comes against the backdrop of rising concerns over air pollution levels in major cities and persistent issues related to water contamination in several parts of the country. There has been sustained pressure from industry bodies, consumer groups and public health advocates to rationalise the tax structure on purification devices, arguing that high taxes undermine efforts to promote preventive health measures. The matter has also drawn attention in legal and policy circles, adding to the momentum for a review of the current tax rate.
Alongside air and water purifiers, the Council may also examine tax treatment for a few other household and health-related products currently taxed at higher rates. However, any decision will require consensus among states, which must balance public health considerations with potential revenue implications. States have traditionally been cautious about rate cuts that could impact GST collections, particularly at a time when fiscal pressures remain elevated.
Tax experts have pointed out that while a reduction in the output GST rate could ease the burden on consumers, the actual price benefit would depend on how much of the cut is passed on by manufacturers and retailers. They have also flagged the need to align input tax rates on components to ensure that the benefit of any rate cut is not diluted by higher taxes earlier in the supply chain.
If the proposed reduction is cleared, it would signal a shift in the GST Council’s approach towards recognising certain consumer appliances as essential from a public health standpoint. The outcome of the meeting will be closely watched by industry and consumers alike, as it could set a precedent for how environmental and health considerations are factored into future GST rate decisions.