GST Revision: Tobacco, alcohol and luxury cars… these things will become expensive due to the new GST changes
GST Revision: The government is preparing to remove ‘compensation cess’ from GST and introduce health and clean energy cess, due to which cigarettes, cold drinks and luxury cars may become expensive.
GST Revision: A major change can come in the GST law implemented in the country. The government plans to implement two new cess in place of the existing compensation cess – one health cess and the other clean energy cess. This will directly affect products like cigarettes, cold drinks, luxury cars and coal. If this proposal is passed, then the burden on the pocket of the common man is sure to increase.
Health cess will be imposed on these things
Health cess will be imposed on those items which are generally considered harmful to the society, such as tobacco products, cigarettes and sugary drinks. These items already come in the 28% tax bracket of GST. Now there is a plan to impose additional health cess on them so that people can be motivated to stay away from them and the government can also get additional revenue.
Clean energy cess affects expensive cars and coal
The second cess – Clean Energy Cess aims to take steps towards clean energy by increasing tax on high-priced vehicles and polluting fuels like coal. This is being considered a step related to Prime Minister Narendra Modi’s Green India policy. It is expected that this will promote electric and less polluting technologies.
There can be a big change in the tax slab as well
According to NDTV, not only cess, the government is also considering abolishing the 12% GST slab. This will move some products into the cheaper range of 5% tax, while some will be included in the higher rate of 18%. Everyday items like toothpaste can be kept in the cheaper tax bracket. However, this may initially put a burden of up to Rs 50,000 crore on the central government, but the government believes that if prices come down, consumption and tax collection will increase.
Government treasury increased by GST collection
According to government data, GST collection has increased by more than 6.2% in the month of June and it has increased to Rs 1.85 lakh crore, whereas in the same period last year this figure was around Rs 1.74 lakh crore. However, the GST collection in June was Rs 2.01 lakh crore in May and Rs 2.37 lakh crore in April.
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