After the GST Council meeting, Finance Minister Nirmala Sitharaman has said that there will be One Nation One Tax in the country. Responding to a question regarding tax slabs, the Finance Minister said that till now 99% of the next generation GST reforms have been implemented in both GST rates and GST processes. On the question of there being a single GST rate in future, Sitharaman said that this will happen as we move forward and talk to stakeholders and people in future.
He said that this tax system, which was implemented in the country on July 1, 2017, is now being made completely rationalized and transparent under the next phase (GST 2.0).
There used to be 17 taxes in the country
Before the implementation of GST, the tax system in the country was very complex. Initially, a total of 17 major indirect taxes and 23 types of cess were collected from the Central Government like Central Excise, Service Tax and State VAT, Octroi, Luxury Tax. By eliminating all these, a single market and a single tax system was created for the entire country.
Journey from initial 4 slabs to GST 2.0
When GST was implemented for the first time in the year 2017, mainly 4 tax slabs (5%, 12%, 18% and 28%) were created. Apart from this, there was a special rate of 0% (tax free) on essential commodities and 3% on gold.
Now to make business easier (Ease of Doing Business), the old slabs of 12% and 28% have been completely abolished. At present the tax system is mainly working in these four categories:
- 0%: Essential commodities, grains and basic health services.
- 5%: Daily essentials and life saving medicines.
- 18%: Standard rate for electronics, home appliances and business services.
- 40%: Highest tax on tobacco products, aerated drinks and luxury cars.
Big relief to businessmen
After today’s meeting, the Finance Minister made it clear that now there will be uniform standards for issuing notices in the entire country. No new notices will be issued in small tax cases of less than Rs 10,000 and the process of seizure of goods has been restricted to specific officers only, thereby ending Inspector Raj.
Read also | What decisions were taken in the marathon meeting of GST Council, know all the major updates in 20 points.
Source: ndtv.in
