The GST Council is likely to make a final decision regarding the Centre’s proposal to reduce GST rates on over 150 items as part of a comprehensive rate adjustment.
As per reports, during its two-day meeting this week, the proposals to move various items from the 12% and 18% GST slabs to the 5% slab or to the nil GST category aim to reduce the tax burden on households and boost spending.
The Council, chaired by Union Finance Minister Nirmala Sitharaman and comprising ministers from all states, will discuss the Centre’s ‘next-gen’ GST reform proposal of having just two tax rates of 5 and 18%.
Ready-to-eat foods such as paratha and parotta, currently taxed at 18%, are also considered for GST exemption. Items including butter, condensed milk, jams, nuts, namkeens, mushrooms, and dates may see a reduction in the tax rate from 12% to 5%.
As per the reports, a significant part of the plan includes expanding the nil GST category by including commonly consumed food items like loose paneer, khakhra, pizza bread, chapati, and roti, which currently face GST rates of 5% to 18%.
Centre is also likely to push for a 5% tax on EVs. The GoM has favoured charging electric vehicles priced up to Rs 40 lakh with an 18% GST, reports suggested. Centre, however, is keen to push EV adoption and favours a 5% rate and the same stance will be pushed in the Council meeting.