GST Council Meet: Hotels Stays To Become Cheaper, Caffeinated Drinks To Cost More
The Logical Indian Crew India
September 21st, 2019 / 12:51 PM
Image Credit: ANI
The 37th GST council meet held in Goa on September 20, revised the tax rates on hotel tariffs, outdoor catering, energy drinks, and passenger vehicles to boost the consumption in various sectors ahead of the festive season.
Headed by Union Finance Minister Nirmala Sitharaman the GST council held the meet had a lot of expectations especially from the auto sector which is experiencing continuous downfall for 10 months. The tax cut also came in the backdrop of economic growth figures which hit a six-year low of 5 per cent for the first quarter of the current fiscal.
The GST rate cuts are expected to give a boost to the tourism and hospitality sectors ahead of the festive season. The new recommendation by the council will be enforced from 1st Oct 2019 and are estimated to cost a revenue loss of around Rs 1,500 crore a year.
— ANI (@ANI) September 20, 2019
Even though the tax rates on some of the passenger vehicles with up to 4,000-mm length carrying 10-13 people were slashed, while the big-ticket automobiles, and biscuits were left untouched as the recommended by the fitment committee.
The following are the announcements made by the 37th GST Council meeting.
- Insurance provided to Central Armed Paramilitary Forces is exempted from GST
- Zero GST is imposed against the hotels with the room tariff of Rs 1000 or less, 12 per cent will be imposed against 1000 to 7,500, and 18 per cent on 7,500. Earlier tariff up to Rs 1,000 attracted no tax, tariff between Rs 2,500 and Rs 7,500 were charged 18 per cent tax, and 28 per cent tax was charged for tariffs above Rs 7,500.
- Passenger vehicles of engine capacity 1,500 cc in case of diesel, 1,200 cc in case of petrol and length not more than 4,000 mm, that are equipped to carry 10-13 people, will now attract a lower compensation cess of 1 per cent and 3 per cent for petrol and diesel vehicles respectively, over and above the 28 per cent tax rate. Earlier, the compensation cess was 15 per cent.
- From the specific agencies, supply of silver and platinum will attract nil GST.
- Caffeinated drinks will be imposed with 28 per cent GST with an additional cess of 12 per cent
- Jewellery exports will have no GST
- Job work services for diamonds reduced to 1.5 per cent, while job works for engineering were reduced to 12 per cent from 18 per cent.
- Defence goods that are not being manufactured indigenous will be exempted from IGST/GST.
Written by : Vanni Baurai (Intern)
Edited by : Shubhendu Deshmukh