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Recently, a Group of Ministers (GoM) meeting was held. In this meeting, changes in the rates of GST i.e. Goods and Services Tax were discussed. Finance Minister Chandrima Bhattacharya said that to provide relief to the common people, it has been proposed to reduce the tax rate on some items from 12 percent to 5 percent. The next meeting will be held on October 20.
There is a need for change in GST.
Chandrima Bhattacharya said that there is a need to change the GST rates. The GoM has talked about changing the tax rates on more than 100 items. This also includes items related to medicine and drugs.
Bicycles and bottled water
Rationalizing taxes on bicycles and bottled water will be discussed in the next meeting of the Group of Ministers. Chandrima Bhattacharya said that bicycles are items used by the common man. Therefore, reducing the tax rate on bicycles should be considered.
Tax deduction on medical items
The GoM has raised the issue of reducing the tax rate on medical and pharmaceutical items in the 12 percent slab. This will be discussed in detail in the meeting next month.
Compensation for revenue loss
If the tax rate is reduced on some items, it may lead to a loss of revenue for the government. To compensate for this loss, the GoM suggested that taxes on some other items should be increased. For example, the tax rate on 'aerated' water and other beverages can be increased.
Structure of GST
Currently, GST is divided into four levels. These include rates of 5, 12, 18, and 28 percent. Under the GST law, goods can be taxed up to 40 percent.
Reduction in average GST rate
Bhattacharya said that the average GST rate has come down to 11.56 percent in 2024. He said that the decision taken in the 23rd meeting of the GST Council should be reconsidered. This will help in raising more revenue.
Members of the Group of Ministers
This six-member ministerial group includes the finance ministers of Uttar Pradesh, Rajasthan, Karnataka, and Kerala. More suggestions will be put forward in the meeting to be held on October 20.
Relief to common people
Bhattacharya said that tax rates should be reduced on items used by common people. This will reduce the prices of food items and provide relief to the common man.
