PLAYING Santa ahead of Christmas, Goods and Services Tax Council comprising representatives of central and state governments has reduced tax rates on 23 goods and services, including movie tickets, TV and monitor screens and power banks, and exempted frozen and preserved vegetables from the levy. The reduced rates are likely to come into effect from January 1, 2019, Finance Minister Arun Jaitley told reporters after the 31st meeting of the GST Council held in Delhi on Saturday. The Goods and Services Tax Council has reduced the rates on 23 items from 18 per cent to 12 per cent and 5 per cent. Many items including television, computers and various auto parts will be cheaper now. Some items in the 5 per cent bracket have been moved to 0 per cent.Of the 23 goods and services on which rates have been slashed, tax rate on seven items in the 28 per cent slab has been brought down. With this, only 28 goods are left in the highest 28 per cent tax bracket.The goods on which the GST has been lowered to 18 per cent from 28 per cent at present include pulleys, transmission shafts and cranks, gear boxes, retreated or used tyres, power banks of lithium-ion batteries, digital cameras, video camera recorders and video game consoles.The 28 per cent slab is now restricted to only luxury and sin goods apart from auto-parts and cement – the tax rate on which could not be cut due to high revenue implication.”Rate rationalisation is an ongoing process. When the original rates were fixed, India had the most irrational taxation rates. Most of these items were charged, along with cascading effect, at 31 per cent. So we had only transiently put them at 28 per cent, because if we had immediately brought it down then the revenue impact would have been there and, therefore, the social expenditure of central and state governments would have suffered.“So, therefore, we followed a more realistic pragmatic and a prudent policy that as the revenues move up and affordability increases we gradually bring it down. And therefore 28 per cent bracket is already moving towards a sunset, except the luxury and sin items, 3 items, which are used by upper income group and only 1 item of common use remains,” Jaitley told media. Besides luxury and sin goods, mass use item cement and white goods like air conditioners and dishwashers are left in the 28 per cent slab. The next target will be rate rationalisation in cement as and when affordability improves,” Jaitley said. Reducing GST on cement would have cost an annual Rs 13,000 crore to the exchequer, he added. The annual revenue implication of the rate cuts would be Rs 5,500 crore, he said.GST on movie tickets costing up to Rs 100 cut to 12 per cent, from 18 per cent, tickets over Rs 100 to attract 18 per cent GST, against 28 per cent earlier. This will have annual revenue implication of Rs 900 crore.Monitors and TV screens up to 32 inches and power banks will attract 18 per cent GST, as against 28 per cent earlier. The annual revenue loss on account of this would be Rs 1,500 crore.The rate rationalisation comes after Prime Minister Narendra Modi on Tuesday indicated that the 28 per cent slab of GST would only be restricted to a few select items, such as luxury and sin goods and said his government wants to ensure that ’99 per cent items attract 18 per cent or lower GST.The other items which will now attract 18 per cent tax include pulleys, transmission shafts and cranks, gear boxes, retreated or used tyres, power banks of lithium ion batteries, digital cameras, video camera recorders and video game consoles. These items currently attract 28 per cent rate.The GST Council has also decided to slash tax rate on parts and accessories for the carriages for disabled persons from 28 per cent to 5 per cent. Also, third party insurance premium of goods carrying vehicles has been reduced from 18 per cent to 12 per cent.The other items will attract lower GST rate of 5 per cent include marble rubble, natural cork, walking stick, fly ash blocks.Music books and vegetables (uncooked or cooked by steaming or boiling in water), frozen, branded and put in an unit container and vegetables provisionally preserved but unsuitable in that state for immediate consumption have been exempted from GST.Services supplied by banks to Basic Savings Bank Deposit account holders under the Jan Dhan Yojana will not attract GST.Air travel of pilgrims by non-scheduled/charter operations being facilitated by the government under bilateral arrangements will attract a lower GST rate of 5 per cent.The Council has decided that 5 per cent would be levied on renewable energy devices and parts for their manufacture. When asked about his message to the industry to pass on the rate cut benefits, Jaitley said, “There is already anti-profiteering authority, which has been more than active. Of course, they have to pass on the rate benefits. Or we will do what we did in case of restaurants”.Jaitley further said that the Council has decided that businesses which are supposed to pay GST and file returns but have not done so far, should file it by March 31, 2019, to avoid penalty. It has also been decided that revised return system of GST will be started from April 1 on trial basis.Due date for filling of return and audit of GST has meanwhile been extended till July 30, he added. Bollywood has hailed the decision , Bollywood actors and producers lauded Prime Minister Narendra Modi for the reduction of GST rates on movie tickets after the 31st Goods and Services Tax (GST) Council meeting. The reduction was announced by Union Finance Minister Arun Jaitley, drawing praises from the Hindi film fraternity. Jaitley said that the GST rates on movie tickets up to Rs 100 have been brought down to 12 per cent and above Rs 100 have been brought down to 18 per cent from 28 per cent. The new GST rates will be effective from January 1, 2019.
Bollywood , India’s largest film maker ,has hailed the bold the decision to reduce the prices of cinema tickets and complimented Prime Minister Narendra Modi, his team including concerned officials for the much needed relief.Director Karan Johar, actors Anupam Kher, Ajay Devgn and film critic and trade analyst Taran Adarsh praised the Prime Minister for the decision. Anupam Kher: Superb news for #IndianFilmIndustry. Cinema tickets upto Rs. 100 which were under 18% GST slab is brought down to 12% slab. Tickets above Rs. 100 were under the 28% slab. These tickets will now be under 18% slab. Thank you PM @narendramodi & officials for this great decision. Karan Johar: Would like to thank our Prime Minister @narendramodi for the swift action on the GST rate on movie tickets….Great news on New Year’s eve.