What Will Become Costlier And Cheaper?

0
955

The Goods and Services Tax – GST has four slabs for services and goods both. These include 5 percent, 12 percent, 14 percent and 28 percent. Complete exemption from the tax base has been given to certain goods as well. The four slabs were released by the GST Council and rolled out from the July 1, 2017. Decision is pending about deciding the tax slab for particular items like tobacco, precious stones and gold.

Studies indicate that this growth-positive GST will help reduce burden of taxation on consumers. A report by Axis Capital states that economy in India may fall between 40 basis to 150 points.

Once the GST has been implemented, there are a few things that will become costlier or cheaper.

No Tax Products

Advertisement

Items used for daily use like curd, milk, meat and cereals have got exemption from GST. Other services that will not be taxed include healthcare, travel to religious destinations, education, metro travel and Haj Yatra.

It is expected that SUVs, two wheelers, white goods and large cars will become cheaper.

Branded Products

A tax of 18 percent will be levied on branded goods, under GST. Presently, around 23-24 percent tax is being levied on branded products.

Hotel Accommodation

For travelers there is good news as 18 percent is the tax levied on hotel accommodation. 28 percent will be charged with an additional tariff of Rs.5000 at high end hotels only. Hotels having tariff below Rs.1000 have got exemption from GST. 22 percent is being levied on hotels currently. 18 percent GST is levied for restaurants which is a good drop from around 22 percent.

Entertainment

A uniform GST of 18 percent is levied for watching movies at movie houses, in most states. Presently taxation on movies is almost 22 percent to 25 percent. GST of 18 percent will be higher for states currently with a low tax rate.

Personal Care Products

Products used for daily care like toothpaste, hair oil and soaps are become cheaper with 18 percent GST. Currently 24-28 percent tax was levied on personal and daily care products.

Air Travel

With a tax of 5 percent, it is expected that airfares will shrink for economy class. 12 percent GST will be charged for business class travel.

Telecom Services

It is expected that telecom services and excise will get cheaper.

Processed Food Products

Under GST, processed food products will attract 5 percent. Presently they are charged with 15 percent tax.

Costlier Masala, Coffee And Tea

Presently tea, coffee and masala are taxed at 3-4 percent. Under GST, tea, coffee and masala will be taxed at 5 percent.

Costlier Casino Services And Gambling

A higher tax of 28 percent will have to be paid by people at Casinos and Gaming Zones who love gambling.

Costlier Home Appliances

GST has made washing machines, televisions and air conditioners more expensive.

Costlier Construction Materials And Metals

Under the GST, cement, mining materials, construction materials and metals will get costlier.

Costlier Cars

Small cars now fall under the 28 percent tax bracket and hence become slightly expensive.

Costlier Sin Products

Luxury items, tobacco and aerated drinks will attract a tax of 28 percent.

Costlier Services And Charges

Direct-to-home services, school fees, Wi-fi, courier services, banking charges, mobile charges and insurance premiums will get costlier.

FMCG

Post GST, deodorants, shampoos and personal care products will become expensive while toothpaste and soaps will get cheaper.

Advertisement