Big change in GST! 5% on education health and 18% on TV-A, but such heavy taxes can be charged to tobacco and online games

During the Day of Independence, Prime Minister Narendra Modi talked about bringing new GST reforms out of the Red Fort. He announced that the new GST reforms would apply to Diwali. Meanwhile, the news has come that the central government has proposed a comprehensive improvement in the framework for goods and services (GST), which aims to simplify the tax system by improving GST. According to a report, the proposal suggested to keep most of the goods under two main sheets – 5% and 18% – while some items of tobacco and online games are proposed to be taxed at 40%. If it gets approval, this will be the biggest amendment since the implementation of GST in 2017. The purpose of this reform is to simplify GST rules, reduce costs for families and businesses and remove contradictions from the existing structure. The Ministry of Finance said in a statement that the rationalization of tax rates to lower the burden on families and supporting farmers, women, students and middle class is recognized as a major priority. Major changes in GST tariffs are expected to reduce to 5%. Similarly, it is suggested to bring all products within 28% to 18% tax. In this, taxes on things like TV, AC, fridge and washing machine can be reduced from 28% to 18%. This will benefit the middle class. It is proposed to give tax exemption or only 5% tax on essential categories such as food, medicine, education and basic needs. In the agricultural sector, GST on devices such as sprinkler and agricultural machinery can be reduced from 12% to 5%. Insurance services can also be reduced from 18% to 5% or zero, while tax rates on medical products and medicine are also expected to reduce the strength of healthcare. In addition, tobacco products and online games can be taxed up to 40%. What things are free of GST, petroleum products, as before, will be outside the GST system. 3% tax on metals such as diamonds (0.25%) and gold or silver will remain unchanged. Meanwhile, reforms for textiles and fertilizers are proposed. The central government sent its proposal to three ministers (glue) to rationalize rates, remuneration and insurance. After their review, recommendations will be sent to the GST Council, which has the right to sanction the plan, convert or reject. Based on the discussion, the council may consider the matter in September or early October.