Skip to main content

Chocolate mithais to attract 5% GST, Centre clarifies

Image
By

Sandesh, with or without chocolate, will be taxed at 5 per cent, the government clarified on Thursday along with the goods and services tax (GST) rates for other items, including rakhis, idlidosa batter and kulfi. However, ambiguity persisted over whether the tax for plastic furniture would be 28 per cent as furniture or 18 per cent as plastic items.
The sharp jump in tax on car leasing is also expected to be taken up in the GST Council meeting on Saturday.
“Sandesh, whether or not containing chocolate, will attract 5 per cent GST,” the government clarified on Thursday.
The clarification comes amid reports that sweet shops have discontinued chocolate barfis and chocolate sandesh. The GST rate on chocolates is 28 per cent Indian sweets are at 5 per cent.
Although milk is exempt in the khoya, or milk, 5 per cent GST.
“Sweet shops in Kolkata were in panic over different GST rates based on the types of sweets and ingredients.
Now the government has clarified that the GST rate on all Indian sweets is 5 per cent,” said Archit Gupta, founder and chief executive officer of ClearTax.
The GST was implemented on July 1 and subsumed most indirect taxes such as excise duty, service tax and valueadded tax.
The government also clarified that kulfi —the Indian frozen dessert —would attract 18 per cent GST, like icecream.
Besides, idlidosa batter would attract 18 per cent GST under the food mixes category, it said.
There would be no GST on regular rakhis but fancy bracelets would be taxed according to their material, the government said days ahead of Raksha Bandhan.
“Rakhi, which is in the form of kalava (raksha sutra) will attract nil GST, but any other rakhi would be classified as per its constituent material,” the clarification said.Rubber bands to tie hair will attract the highest GST rate of 28 per cent.
Any prefabricated building, including portable and mobile toilets, will attract 18 per cent GST. Solar panels and modules will attract 5 per cent tax, but their mounting structure made of iron, steel or aluminum will be taxed at 18 per cent.
“We hope for clarity by the GST Council soon.
Plastic chair manufacturers are charging 18 per cent GST, ideally these should be classified under furniture,” said MS Mani of Deloitte.
The tax burden on car leasing firms has gone up to 43 per cent, includinga15 per cent compensation cess, from the earlier incidence of 13-14 per cent.
“There are many options before the government to address the car leasing issue.
Either the rate itself can be reduced for existing leases or refund of Central GST and compensation cess paid can be granted,” said Pratik Jain of PwC.
Besides, multipurpose printers, with fax and photocopy, have been put in the 28 per cent category, against 18 per cent for printers.
“Clarity is needed for many items such as movie halls.
Local bodies are allowed to levy their own tax, thus bringing the total tax to 58 per cent in states like Tamil Nadu.
There is still no clarification regarding various state tax holidays and benefits enjoyed by many industries,” said Gupta.
The Business standard, New Delhi, 04th August 2017

Comments

Post a Comment

Popular posts from this blog

RBI rushes in to prop up falling rupee

By
RBI rushes in to prop up falling rupee India’s central bank reportedly intervened in the currency markets on Monday to prevent a further slide in the local unit, which breached the 67 mark to a dollar for the first time in 15 months amid a widening trade gap and runaway import bills fuelled by high crude-oil prices. Some state-owned banks were seen selling dollars aggressively, interventions that market dealers attributed to the central bank’s strategy to stem the decline of the Indian rupee against the US currency. The rupee is the worst performing among a dozen Asian monetary units in the past three months. It lost 4.25 per cent to the dollar during the period, show data from Bloomberg. On Monday, the Reserve Bank of India (RBI) is said to have sold about Rs 800 million collectively on the spot and exchange traded futures markets, dealers said. An email sent to RBI remained unanswered until the publication of this report. The currency market has seen such a strong central bank interven…
Post a Comment
Read more

GST Refund of Rs 20,000 Cr Pending: Exporters’ Body

By
GST Refund of Rs  20,000 Cr Pending: Exporters’ Body Refund of over Rs 20,000 crore on account of Goods and Services Tax (GST) is pending with the government with more than half the amount stuck as input tax credit, Federation of Indian Export Organisations said on Tuesday. While claims over Rs7,000 crore were cleared in March, the amount was Rs 1,000 crore in April.However, after exporters’ request, the GST council and tax department are organizing a second phase of Special Refund Fortnight starting May 31, which will enable exporters to draw their refunds at a speedy pace. Many exporters have been unable to file the refund of input tax credit due to technical glitches, exports and claim happened in different months. The major challenge lies on ITC refund especially because the process is partly electronic and partly manual which is cumbersome and add to the transaction cost, the exporters’ body said. On IGST, refunds are getting delayed due to airline and shipping companies not submitt…
2 comments
Read more

Shrinking footprints of foreign banks in India

By
Shrinking footprints of foreign banks in India Foreign banks are increasingly shrinking their presence in India and are also becoming more conservative than private and public sector counterparts. While many of them have sold some of their businesses in India as part of their global strategy, some are trying to keep their core expertise intact. Others are branching out to newer areas to continue business momentum.For example, HSBC and Barclays Bank in India have got out of the retail business, whereas corporate-focused Standard Chartered Bank is now trying to increase its focus on retail “Building a retail franchise is a huge exercise and takes a long time. You cannot afford to lose it,” said Shashank Joshi, Bank of Tokyo-Mitsubishi UFJ’s India head.According to the Reserve Bank of India (RBI) data, foreign banks’ combined loan book shrunk nearly 10 per cent from Rs 3.78 trillion in fiscal 2015-16 to Rs 3.42 trillion last financial year. The banking industry, which includes foreign banks…
Post a Comment
Read more