Cars

Cess on vehicles up but small cars get relief

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Nagara Gopal
Union Finance Minister Arun Jaitley

GST rate on 30 goods comes down; Oct 10 is last date to file returns


Hyderabad, September 10:  

Small cars and hybrid vehicles have been spared even as the GST Council raised the cess on mid-sized and large cars and sport utility vehicles (SUVs).

The Council, which met here on Saturday, decided to increase the cess by 2 per cent on mid-sized cars, 5 per cent on large cars and 7 per cent on SUVs.

It has, however, decided to maintain status quo on four categories of vehicles — small cars (petrol and diesel), 13-seater vehicles, and hybrid vehicles.

Addressing the media after the 21st meeting of the GST Council here, Union Finance Minister Arun Jaitley said a decision had been taken to reduce GST on about 30 goods.

The list includes rubber bands, dosa batter, raincoats, dried tamarind, agarbattis, computer monitors, custard powder, brooms and roasted peanuts. The council has also decided to exempt GST on khadi sold through KVICs. Handicraft traders who trade inter-State need not register under GST if their turnover is less than ₹20 lakh.

Marathon meeting

The eight-hour-long meeting is the third Council meeting after GST was rolled out nationwide on July 1. A huge number of trade and business bodies met the Finance Minister seeking reduction of GST rates.

Public construction

Meanwhile, the Council has decided to expand the definition of ‘works contract’ to bring down the GST on services provided to construction of public structures from 18 per cent to 12 per cent.

The Centre, however, did not appear favourably disposed to the Telangana government’s request to bring down the rate to 5 per cent.

Jaitley felt the States would have to pay contractors if the rate were to be reduced further.

Supply of heavy and nuclear fuels by the Department of Atomic Energy to NPCIL has been exempted from the GST.

Jaitley announced that the last date for filing GST returns (for July) has been extended to October 10. The last date for those with a turnover of more than ₹100 crore is October 3.

Tech challenges

The Council has decided to form a Group of Ministers to monitor and resolve the information technology challenges in the GST rollout. Another committee will be set up to study the GST related issues with regard to exports. Officials of States and the Centre will be members of the panel.

Answering a query on criticism on higher tax rate on sanitary napkins, the minister said the effective tax had actually been reduced from the pre-GST regime.

Branded packaged foods

In order to keep tabs on certain firms trying to register brands to stay outside the GST, the Council has announced a cut-off date.

All brands that registered as on May 15, 2017, will come under the GST’s ambit even if they have registered later, in case they want to sell the produce under that brand.

(This article was published on September 10, 2017)

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