New Delhi, Jul 27: Footwear and other items of common use like washing machine, fridge will get cheaper from Friday as the GST rate cut comes into effect. The GST Council, chaired by Union Finance Minister Piyush Goyal, last week pruned the highest 28 per cent tax slab by moving some white goods to the 18 per cent tax bracket leaving just 35 items, including AC, digital camera, video recorders, dish washing machine and automobiles, in the highest tax bracket.
Refrigerator, washing machine, small screen TV, storage water heaters, paints and varnishes will attract 18 per cent GST from today, as against 28 per cent at present.
Sanitary napkins, which attract 12 per cent GST, have been exempted from tax with effect from today. However, it was feared that its price may go up as manufacturers would not be able to avail credit of taxes paid on inputs. But finance ministry officials were of the opinion that prices should come down as input tax credit (ITC) claimed was around 2-4 per cent, while the GST was 12 per cent.
Goyal had also rejected the notion that prices of sanitary napkins would go up. He has already asked the directorate general of anti-profiteering to keep a tab on prices of sanitary pads to ensure that benefits of rate cuts are passed on to consumers.
Besides, GST rate on ethanol will be slashed to 5 per cent from 18 per cent at present, the same for bamboo floorings has been cut to 12 per cent from 18 per cent from today.
Food grinders, lithium ion batteries, vacuum cleaner, hand dryers will attract 18 per cent Goods and Services Tax from today, down from 28 per cent earlier.
Footwear costing up to Rs 1,000 will now attract 5 per cent GST. So far, footwear up to Rs 500 attracted 5 per cent GST, and those having retail sale price of over Rs 500 attracted 18 per cent rate.
Also fortified milk, idols made of stone, marble, wood, rakhi not embedded with stone, phool jhadu, sal leaves, too will been exempted with effect from today.
Items that get cheaper from today:
Small screen TV
Storage water heaters
Paints and varnishes
Lithium ion batteries
Idols made of stone, marble, wood
Rakhi not embedded with stone
Items under highest tax slab:
Demerit items like tobacco, cigarette and pan masala
In the services sector, the hotel industry too has been given major relief as GST on accommodation service will now be based on transaction value instead of declared value.
Also, the tax rate on supply of e-books has been cut to 5 per cent from 18 per cent.
(Inputs from PTI)