27.1 C
Delhi
Tuesday, October 26, 2021

GST changed tax system, many things become cheaper; Relief for farmers, common man and businessmen

Today is the first death anniversary of former Finance Minister Arun Jaitley. On August 24 last year, he said goodbye to this world. Arun Jaitley has a significant contribution in implementing the new tax system ‘GSI’ in the field of indirect tax in the country. GST was implemented in India on July 1, 2017, during Jaitley’s tenure as finance minister. Remembering him on Jaitley’s death anniversary, the Finance Ministry has given information about changes in the tax system from GST.

The Finance Ministry has said in several tweets that before the GST was implemented, the standard rate of tax had reached 31% in many cases due to the combinatorial effect of VAT on VAT, excise, central sales tax and tax in the country. The imposition of a different rate of tax in each state on markets spread across the country led to huge inefficiency and high cost of compliance. Under GST, compliance is constantly improving and the taxpayer base has almost doubled to 1.24 crore. According to the Finance Ministry, GST has reduced the rate at which people have to pay tax. According to the RNR committee, the revenue-neutral rate in the country was 15.3%. In comparison, according to the RBI, currently, the weighted GST rate is only 11.6%.

Increased taxpayer base

The Finance Ministry has said that it is now widely accepted that GST is favourable to both consumers and taxpayers. Higher tax rates prior to GST acted as a disruptive step towards paying taxes, while lower rates under GST helped to increase tax compliance.

After the implementation of GST, the taxpayers base has almost doubled. At its inception, the number of taxpayers covered by GST was around 65 lakhs. Now the taxpayer base is more than 1.24 crores. A speciality of GST is that all the processes in this are fully automated. So far 50 crore returns have been filed online and 131 crore e-way bills have been generated.

How to get cheap items?

The Finance Ministry says that since the introduction of GST, the tax rate on a large number of items was brought down. Now the 28% rate is almost entirely confined to addictive products and luxury items. Out of the total 230 items of the 28% slab, about 200 items have been transferred to the lower slab. GST is either zero or 5 per cent on most everyday things. The tax rates on commonly used items like hair oil, toothpaste and soap were 29.3 per cent before GST was implemented, but 18 per cent in GST.

Refrigerator, washing machine, vacuum cleaner, food grinders and mixers, juice dispenser, shaver, hair clipper, water heater, hairdryer, an electric smoothing iron, up to 32-inch television, the earlier tax rate was 31.3 per cent, now these things 18 per cent is under GST. The tax rate on cinema tickets was anywhere between 35 to 110 per cent before. The rate in GST is now between 12 and 18 per cent. The GST has provided significant relief to the construction sector, especially the housing sector. It is now placed in the 5% tax slab. GST on affordable housing has been reduced to 1%. 5 per cent GST is applicable on restaurants.

How To Get benefit by Businessmen?

According to the Finance Ministry, businessmen with annual turnover up to Rs 40 lakh are exempt from GST. Initially, this limit was Rs 20 lakhs. Additionally, people with a turnover of up to Rs 1.5 crore can opt for the composition scheme and pay only 1% tax for the goods.

How did the agriculture sector benefit?

Substantial concessions have been given to the agriculture sector in GST. The net tax on fertilizers was reduced to half in GST. The tax rates on agricultural implements decreased from 15-18% to 12% and on some items, there is a reduction from about 8% to 5%. Cattle fodder, aquatic fodder and poultry fodder have all been kept at zero rates in GST, as is the case for all types of seeds. In other words, there is no tax of any kind under the GST system on these important components used in the agricultural process. The tax rate was over 10% before GST was applied on chemical fertilizers (1% excise duty, 2.44% embedded excise duty, about 4% weighted average VAT and 2.5% CST, octroi, etc.), while all types in GST system The tax rate on chemical fertilizers is only 5%.

Get Business News,, latest India News,, and other breaking news on the share market, investment scheme and much more on Business Khabar. Like us on Facebook, Follow us on Twitter for the latest financial news and share market updates.

 

Source: https%3A%2F%2Fwww.financialexpress.com%2Fhindi%2Findia-news%2Fhow-gst-has-changed-indias-indirect-tax-system-after-gst-tax-rate-on-a-large-number-of-items-was-brought-down-goods-and-services-tax-has-benefited-all-including-farmers-taxpayers-common-man-and%2F2063702%2F

Shehnazhttps://www.businesskhabar.com/
Shehnaz is a Corporate Communications Expert by profession and writer by Passion. She has experience of many years in the same. Her educational background in Mass communication has given her a broad base from which to approach many topics. She enjoys writing about Public relations, Corporate communications, travel, entrepreneurship, insurance, and finance among others.
Latest news
- Advertisement -
Related news
- Advertisement -

LEAVE A REPLY

Please enter your comment!
Please enter your name here