Historic Diwali Gift From PM To Nation - GST Reform

Historic Diwali Gift From PM To Nation - GST Reform
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The Goods and Services Tax (GST) Council, in a recent meeting, endorsed a new, simplified two-tiered rate system, featuring rates of 5% and 18%. This change, effective from September 22, will replace the previous four-slab structure of 5%, 12%, 18%, and 28%. Additionally, a new 40% rate is proposed for specific luxury items, including high-end vehicles and tobacco products.

Union Finance Minister Nirmala Sitharaman highlighted the council's unanimous decision to implement these reforms, emphasizing their focus on benefitting the "common man." She noted that the new structure would not only simplify the tax system but also address various issues such as compensation, registration, return filing, and refunds. According to Sitharaman, these changes are part of a broader effort towards "next generation reforms" and are expected to bring stability and predictability to the GST framework. The minister also mentioned that the reforms would resolve issues like inverted duty structures and classification problems, ultimately making it easier for businesses to operate.