GST Rate Rationalisation: Relief for Common Man, Price Hikes for Luxury Goods

The Group of Ministers (GoM) on GST rate rationalisation discussed tax rate changes for over 100 items, considering reductions on common goods to 5% and potential hikes on luxury items. The next meeting is set for October 20 to further deliberate and provide recommendations to the GST Council.

The Group of Ministers (GoM) on GST rate rationalisation has evaluated tax adjustments for over 100 items, aiming to reduce taxes on certain essentials from 12% to 5% for the benefit of the common man, West Bengal Finance Minister Chandrima Bhattacharya revealed on Thursday.

The GoM, consisting of six members, plans to further discuss these ideas in its next meeting on October 20. Key topics include adjusting taxes on bicycles and bottled water, as well as considering tax cuts on medical and pharmaceutical items currently taxed at 12%.

To offset the revenue losses from these reductions, the GoM is exploring raising taxes on luxury items such as aerated beverages from 28% plus cess. With the average GST rate now at 11.56%, West Bengal suggests revisiting past decisions that reduced tax rates, favoring fewer tax burdens on essentials to relieve the common man.

(With inputs from agencies.)