Education, healthcare exempted,tax on services finalized: GST council
Srinagar: The all-powerful goods and service tax (GST) Council on Friday finalised tax rates for services under the GST regime, scheduled to kick-in from 1 July.
Kerala finance minister Thomas Issac said there will be four rates for services at 5, 12, 18 and 28%, similar to tax slabs for goods.
The tax rate on gold has not been finalised yet, he said, adding that the Council will meet again on 3 June.
Union Finance Minister Arun Jaitley Friday said the new tax regime will be consumer-friendly besides being an efficient tax system.
He also said that healthcare and education will remain exempted from the GST, while transport services will be taxed at 5 per cent.
Addressing reporters after attending a two-day meeting of the GST Council in Srinagar, Jaitley allayed concerns surrounding the new tax regime, saying rates have not been hiked and insisted that under the new system either present rates were maintained or they have been brought down. He said rates of services will be in four slabs: 5, 12, 18 and 28 per cent.
Going into details, Jaitley said telecom and financial services will be taxed at a standard rate of 18 per cent while 28 per cent of tax will levied for race club, betting and cinema halls.
He also said restaurants with turnover of Rs 50 lakh or below will face 5 per cent tax under the new tax regime while non-AC restaurant to be taxed at 12 per cent.
Touted as the biggest reform in the country’s indirect tax structure, GST will introduce a single tax on supply of goods and services, right from the manufacturer to the consumer.