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Proposal To Reduce GST On 20-Litre Water Bottles & Bicycles; Which Items Will Be Costlier?

New Delhi: The Group of Ministers (GoM) for GST rate rationalisation has decided to lower tax rates on certain products like 20-litre packaged drinking water bottles, bicycles and exercise notebooks from 18% to 5%, PTI reported quoting officials.

If that is good news for some people, there will be an increase in prices on some luxury items as the GoM suggested raising taxes on high-end wrist watches and shoes.

Watches which currently cost more than Rs 25,000 and shoes worth above Rs 15,000 will now attract GST of 28% — up from the existing 18%.

According to PTI, once the changes suggested by the GoM headed by Bihar Deputy Chief Minister Samrat Chaudhary are effected, it would result in a revenue gain of Rs 22,000 crore.

The six-member GoM on GST rationalisation also includes Uttar Pradesh Finance Minister Suresh Kumar Khanna, Rajasthan Health Services Minister Gajendra Singh, Karnataka Revenue Minister Krishna Byre Gowda and Kerala Finance Minister K N Balagopal.

Among other proposed rate changes, certain items in the 18% GST slab like hair dryers, hair curlers, and beauty or make-up preparations could be pushed up to the 28% bracket.

GST is currently a four-tier tax structure — 5%, 12%, 18% and 28% slabs.

Essential items are exempted or taxed the lowest and luxury items are taxed the highest.

OB Bureau

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