When the Goods and Services Tax(GST) was introduced as part of the 101st Amendment of the The Indian Constitution, the Nation was left confused.
GST is nothing but a Value Added Tax which is levied on sale, manufacture and consumption of goods and services at the national level in the country.
The tiny portion underneath each bill we pay these days which states “VAT added” is the real deal here.
Last week, the GST council has announced tax slabs and add-on cess(s) on 1,211 items within the country.
In case of all services within the country, 4 broad tax brackets have been created and all major products have been grouped under these 4 tax brackets.
These 4 broad tax brackets are placed at 5%, 12 %, 18 % and 28 % .
So, what are the goods exempted from taxation?
And what are the products which are going to taxed at a higher percentage?
Let’s take a closer look.
One of the biggest surprises came in the form of GST imposed on Mobile Phones.
Most mobile phones will now get costlier as the Indian Government begins imposing 12% tax levy on them.
This would gravely affect the local manufacturers as well.
The most expected tax levy came in for chewing tobacco, scented zarda and filter khaini where the tax levied ranges from 60 per cent up to 290 per cent.
Filter and non filter cigarettes have been differentiated in terms of the add on cess imposed.
In case of cigars, a huge levy of 21 % (translated to Rs. 4,170) per 1000 sticks (whichever is higher) has been introduced.
These charges would all fall under the 28% or more bracket.
All the changes have not been welcomed by the Indian states by and large.
Since these taxes have been approved last week, they would come into execution from 1st of July, 2017 onwards.
Several states like Kerala and West Bengal are yet to provide their approval of the same, whereas states like Maharashta and Madhya Pradesh have already provided their approval for the same.
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