Maharashtra state passes State GST bill

Indian Prime Minister Narendra Modi might be able to roll out this reform without a politically damaging rise in inflation

Indian Prime Minister Narendra Modi might be able to roll out this reform without a politically damaging rise in inflation

During this session, the Assembly passed three bills, the State Goods and Services Tax Bill, related to the compensation to local authorities and a bill on the existing laws to be overturned, when the GST is expected to come into effect from July 1.

The GST Council, the key decision-making body for Goods and Services Tax (GST) implementation, has fixed the GST rate at 18% for cable TV and direct-to-home (DTH) services.

Thus, entertainment services shall suffer a lower tax incidence under GST. Justifying the move, the finance ministry said that the entertainment tax rates on theatres/cinema halls is as high as 100% in some of the states.

Along with CST, octroi, entry tax, etc., the present total tax incidence on them works out to more than 13 percent.

The proposed GST rate for cement is 28% against the present total tax incidence that works out to more than 31%.

India's enhanced tax revenues should be used to boost spending on health and education which is much lower as
Modi's biggest tax reform GST to transform India's $2 trn economy

Panchayats and municipalities can still levy a tax on entertainment over and above the GST. Other renewables equipment, including wind turbines, marine energy devices and solar lamps got 5% tax, Coal also faces just 5%, down from the current rate of 11.69%. In addition, companies pay central sales tax, octroi and entry tax, among others.

The Ministry said, there will be lesser tax burden in case of Medicaments, including Ayurvedic, Unani, Siddha and Homeopathic. "The GST rate for work contracts, which will also be offset by input credits, will provide for a seamless and simplified tax policy", he said.

"The additional burden on real estate on account of stamp duty averages between 5-8 per cent of the value of the immovable property.Unless abatement for land is allowed, cost to the end consumer would go up", Credai President Jaxay Shah said in a statement. As against this, the proposed GST rate for smart phones is 12 percent.

Worship materials including that required for "havan" will be under the nil category.

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