On Friday, the GST council made multiple changes to the Goods and Services Tax (GST) after three months of it being imposed. The main aim was to provide relief to small and medium businesses and exporters who have been struggling due to complexities in the indirect tax. The GST council also cut rates for 27 common use items.
The GST council is headed by Union Finance Minister Arun Jaitley who announced that the turnover threshold would be raised in the composition scheme from Rs. 75 lakhs to Rs. 1 crores. This scheme will allow traders to pay 1 to 5% tax easily without the tedious formalities.
Among the common use items, Jaitley informed that khakhra, plain chapati, food packets and unbranded namkeen will be brought down to 5% from 18%.
Unbranded medicines have also been brought down to 5% from the previously decided 12%. The parts of diesel engine have also been reduced from 28 to 18%.
The Finance Minister also reported that a group of state finance ministers has been formed to review issues and also rationalize the GST rate for restaurants.
These decisions have come after the opposition parties have been pointing out at the struggles GST has brought on exporters and small businesses.
