GST Rates Revision update | In 28th Council Meet

gst council meet for GST Rates Revision update pic

The 28th GST Council meeting held on 21st July 2018. Council has recommended many crucial changes in this meeting with regards to bringing GST rates on many goods and handicraft items.

Further Council has recommended bringing GST rate to Nil on Sanitary Napkins, Rakhi, and more Goods. Also, it recommends allowing refunds to fabrics on account of inverted duty structure. Let us see the complete details about these changes. Please note that these changes will come into effect only after issuing of Notification/circular by the government. GST council took the following decisions on GST Rate on Goods.

A) GST Rates Revision update on Various Goods

1. From 28% to 18%

• Paints and varnishes (including enamels and lacquers)
• Glaziers’ putty, grafting putty, resin cement
• Refrigerators, freezers, and other refrigerating or freezing equipment including water cooler, milk coolers, refrigerating equipment for the leather industry, ice cream freezer, etc.
• Washing machines.
• Lithium-ion batteries
• Vacuum cleaners
• Domestic electrical appliances such as food grinders and mixers & food or vegetable juice extractor, shaver, hair clippers, etc
• Storage water heaters and immersion heaters, hairdryers, hand dryers, electric smoothing irons, etc
• Televisions upto the size of 68 cm
• Special purpose motor vehicles. e.g.crane lorries, fire fighting vehicle, concrete mixer lorries, and spraying lorries
• Works trucks [self-propelled, not fitted with lifting or handling equipment] of the type used in factories, warehouses, dock areas, or airports for short transport of goods.
• Trailers and semi-trailers.
• Miscellaneous articles such as scent sprays and similar toilet sprays, powder-puffs, and pads for the application of cosmetics or toilet preparations.

2. From 28% to 12%

• Fuel Cell Vehicle. Further, Compensation cess shall also be exempted on fuel cell vehicle.

3. From 18%, 12%, 5% to NIL

• Stone/Marble/Wood Deities
• Rakhi [other than that of precious or semi-precious material of chapter 71]
• Sanitary Napkins,
• Coir pith compost
• Sal Leaves siali leaves and their products and Sabai Rope
• PhoolBhariJhadoo [Raw material for Jhadoo]
• Khali dona.
• Circulation and commemorative coins, sold by Security Printing and Minting Corporation of India Ltd [SPMCIL] to the Ministry of Finance.

4) From 12% to 5%

• Chenille fabrics and other fabrics under heading 5801
• Handloom dari
• Phosphoric acid (fertilizer grade only).
• Knitted cap/topi having retail sale value not exceeding Rs 1000

5) 18% to 12%:

• Bamboo flooring
• Brass Kerosene Pressure Stove.
• Hand Operated Rubber Roller
• Zip and Slide Fasteners

6) 18% to 5%

  • Ethanol for sale to Oil Marketing Companies for blending with fuel
  • Solid bio fuel pellets

7) GST Rate change made in respect of footwear

• 5% GST on retail sale price up to Rs. 1000 per pair
• 18% will continue on Footwear having a retail sale price exceeding Rs. 1000 per pair

GST rates on Handicraft items to be brought down:

8) 18% to 12%:

• Handbags including pouches and purses; jewelry box
• Wooden frames for painting, photographs, mirrors, etc
• Art ware of cork [including articles of sholapith]
• Stone art ware, stone inlay work
• Ornamental framed mirrors
• Glass statues [other than those of crystal]
• Glass art ware [ incl. pots, jars, votive, cask, cake cover, tulip bottle, vase ]
• Art ware of iron
• Art ware of brass, copper/ copper alloys, electro plated with nickel/silver
• Aluminium art ware
• Handcrafted lamps (including panchloga lamp)
• Worked vegetable or mineral carving, articles thereof, articles of wax, of stearin, of natural gums or natural resins or of modeling pastes, etc, (including articles of lac, shellac)
• Ganjifa card

9) 12% to 5%:

  • Handmade carpets and other handmade textile floor coverings (including namda/gabba)
  • Handmade lace
  • Hand-woven tapestries
  • Hand-made braids and ornamental trimming in the piece
  • Toran

B) Other Miscellaneous Changes relating to valuation of a supply:

  •  Assessable value + Customs duty for Calculating IGST: IGST @5% on Pool Issue Price (PIP) of Urea imported on Government account for direct agriculture usage, instead of assessable value plus custom duty.
  • Exemption from Compensation cess to Coal rejects from washery [arising out of cess paid coal on which ITC has not been taken].

C ) Following are other Clarifications/amendments as regards applicability of GST rate in respect of certain goods:

• Milk enriched with vitamins or minerals salt (fortified milk) is classifiable under HS code 0401 as milk and exempt from GST.
• 5% GST on both treated (modified) tamarind kernel powder and plain (unmodified) tamarind kernel powder.
• Beet and cane sugar, including refined beet and cane sugar, (falling under heading 1701) attracts a 5% GST rate.
• Water supplied for public purposes (other than in sealed containers) does not attract GST.
• Marine engine (falling under sub-heading 8408 10 93) attracts 5% GST rate.
• Kota stone and similar stones [ other than marble and granite] other than polished will attract 5% GST, while ready to use polished Kota stone and similar stones will attract 18%.
• Certain other miscellaneous clarification as regards classification/rate has been recommended

D) Refund of collected credit on account of inverted duty structure to fabric manufacturers:

Currently, Fabrics attract GST at the rate of 5% subject to the condition that refund of accrued ITC on account of inversion will not be allowed.

However, seeing the difficulty encountered by the Fabric sector on account of this condition, the GST Council has suggested allowing refund to fabrics on account of inverted duty structure. The refund of collected ITC shall be allowed only with the potential effect on the purchases made after the notification is delivered.

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