4 Slabs of services under GST regime
4 Slabs of services under GST regime:
Goods and service tax is just a month far where all the indirect taxes will be merged into one with so many advantages and implications. GST has been so much in talk to make a revolution in India’s economy. let us look to the 4 Slabs of services under GST regime.
Indian government has finalized four tax rates that are to services including telecoms, insurance, hotels and restaurants under a new sales tax under GST. The tax rates will be 5, 12, 18 and 28 percent the tax rates are different for goods and services and these are in line with those of goods. There are many sectors in the services where the GST under these four slabs will be applied.
There have been a lot of talk between Indian government considering the rates of Services and the slabs under them to be covered. It is being clear about the amount and percentage of the tax that will be applied under each category of the services.
Few of the facts about the services decided under the services rates and the tax rates for 1,211 items, are approximately:
- 7 per cent those are exempted,
- 14 per cent are in the 5 per cent slab
- 17 per cent in the 12 per cent slab
- 43 per cent in the 18 per cent slab
- 19 per cent of goods are into the top tax bracket of 28 per cent.
There are been few segregation and also few tax categories under the industry of services and based on the amount of comfort-ability the amount and percentile of each slab has been finalized.
- Telecoms and financial services at a standard rate of 18% will be taxed
- Transport services will be taxed at 5%.
The new tax rates would affect everything from your restaurant visits, movie dates, visits to the salon and even your phone bills. Rail, air and road transport will fall in the 5 percent tax slab.
- Non air-conditioned restaurants will attract a tax levy of 12 per cent whereas
- air-conditioned restaurants will have fall in the 18 per cent tax bracket.
- Hotels with tariff between Rs 2,500 to Rs 5,000 will attract a GST of 18 per cent,
- whereas hotels with tariff of above Rs 5,000 will fall under the 28 per cent tax slab.
- hotels with tariff under Rs 1,000 are exempt from the GST regime.
- Services, which are at currently taxed 15 per cent will be fitted into the 18 per cent bracket and services will get the benefit of input tax credit for the goods used
- luxury services to be 28%.
- Basic food items like cereals, eggs and meat will attract zero tax while processed food items will be charged between 12 and 28 per cent.
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