Being a consuming state, Odisha likely to benefit from GST
- Author: Leroy Wright May 22, 2017,
May 22, 2017, 11:04
The GST Council finalised four tax rates of 5, 12, 18 and 28 per cent similar to the tax slabs for goods - for the various services, including telecom, insurance, hotels and restaurants.
The telecom industry, expressing its disappointment over the 18 per cent Goods and Services Tax (GST) rates, on Friday said it will further stress the already bleeding balance sheet of the sector and may negatively impact consumers. The council had earlier decided a five-slab structure of 0%, 5%, 12%, 18% and 28%.
Services such as those of tour operators, leasing of aircrafts, economy class air travel, transport of goods by rail, rail travel other than sleeper class and radio taxi travel will attract a 5 per cent levy under GST.
Under the GST, cars will attract the top rate of 28 per cent with a cess in the range of 1 to 15 per cent on top of it.
Jaitley said non-AC restaurants will charge 12 per cent GST on food bill.
Transport services including air services and goods transport will be taxed at 5% from the existing rate of 15%.
He said that while "luxury services" would attract the highest rate of 28 per cent, health and education services would be exempt categories.
Daily consumption items such as milk, fruit and vegetables, jaggery or gur, foodgrain and cereals will cost less as they have been exempted from tax.
E-commerce players like Flipkart, Snapdeal will have to deduct 1 per cent TCS (tax collected at source) while making payments to suppliers. If the GST isn't introduced in the state, consumers will have to pay double tax.
Speaking to reporters after the meeting, Kerala Finance Minister Thomas Isaac said that "not in a single case has there been an increase in taxes from before".
"For service providers, it is going to get troublesome", claims Saloni Roy, a senior director at tax consultancy firm Deloitte Haskins & Sells LLP. The industry has said it hopes the government will come up with steps to keep benefits of local manufacturing vis-a-vis imports intact, like in the pre-GST regime, else millions of dollars of investments made over the past year or so will be at risk.
The most crucial GST Council meeting took place on 18 and 19 May, 2017 in Srinagar, Jammu and Kashmir.
The heightened pace of activities indicates that 01 July, 2017 is the dateline for GST in India. In the overall basket there would be a reduction, but we are banking on the hope that because of a more efficient system, evasion would be checked and tax buoyancy would go up.