Major tax reform on cards; 12% GST slab may be reduced or scrapped
Nwe Delhi: In a move that could bring major relief to millions, the central government is planning to restructure the Goods and Services Tax (GST) rates. Sources told India Today that the 12% GST slab may be reduced or removed altogether.
This decision could make several essential items cheaper for middle- and lower-income households. Most of the products under the 12% slab are used daily by ordinary citizens.
The government is reportedly considering two options. One, to lower the GST on these goods from 12% to 5%. The other, to scrap the 12% slab completely and shift items to either the 5% or 18% brackets.
If approved, this will be one of the biggest changes to the GST system since it was launched in 2017.
The matter will be discussed at the upcoming 56th meeting of the GST Council. Though the meeting requires a 15-day notice, sources say it could be held later this month.
The GST Council is headed by the Union Finance Minister. State finance ministers are also part of the body and must agree to any rate changes.
This move is also being seen as politically important. It comes at a time when elections are nearing, and inflation is affecting daily life.
By reducing GST on essential goods, the government hopes to ease financial pressure on the common man and boost consumer confidence.
If passed, the new rates could be rolled out soon. The final decision now rests with the GST Council.
