According to the interim finance minister Piyush Goyal, the revenue loss will be negligible.
Mumbai: The GST Council meeting held on 21st July, chaired by Interim Finance Minister Piyush Goyal has reduced GST rate on various commodities. The decision of GST rate cut would result in loss of income to the government to an extent of Rs 15,000 crore annually, as per report by Mint.
The GST Council in its meeting has decided to cut levies on 50 products comprising of washing machines, lithium-ion batteries, vacuum cleaners, food grinders, mixers, storage water heaters, head dryers, hand dryers, paint, varnishes, water cooler, milk cooler, ice cream coolers, perfumes, toilet sprays and other toiletries has been slashed from 28 per cent to 18 per cent.
The GST on handbags, jewellery box, wooden box for paintings, glass art ware, ornamental framed mirrors, handmade lamps, wax, natural gum, iron and brass products have been reduced from 18 per cent to 12 per cent.
The GST on some commodities has been slashed from 18 per cent to five per cent, including ethanol, and solid bio-fuel pellets, as per report from ANI. The changes made in the GST rate will come into effect from 27 July.
According to the interim finance minister Piyush Goyal, the revenue loss will be negligible. However, according to the officials, in the report, the revenue loss is estimated to be as high as 1 per cent of the tax budget. Currently, the government is not in a position to let go such revenue, as it has in the pipe line many projects for public welfare and the rising crude oil prices can widen the fiscal deficit.
The next GST Council meeting is scheduled to be held on 4 August. The main agenda of the meeting would be to address the issues faced by small businesses under the GST regime.
(With Inputs from Agencies)