With the Goods and Services (GST) Council finalising tax rates on the remaining items — gpld, biscuits, garments, beedis, diamonds — at its 15th meeting on Saturday, India moved one step closer to implementing the landmark indirect legislation from July 1, 2017.
However, the skewed nature of tax rates on various items has evoked many responses from people, even as the Council introduced a new slab for gold, diamond — 3 percent — to the existing five slabs (0, 5, 12, 18 and 28 percent), as was predicted by many industrialists.
The All India Gems and Jewellery Trade Federation had pitched for 1.25 percent GST on gold. Currently, the import duty on gold is 10 percent that will remain unchanged, while states charge about 2 percent as value added tax (VAT), with Kerala's VAT on gold at 5 percent is the highest.
The Gem & Jewellery Export Promotion Council (GJEPC) expressed disappointment at taxing diamonds at 3 percent.
"Taxing diamonds is a retrograde step and not in sync with equivalence policy. Diamonds are the key raw materials for gem and jewellery exports business. Rough diamonds have been kept out of the purview of taxes even in many Asian countries which are globally competitive," Praveenshankar Pandya, Chairman, GJEPC, said in a statement.
The Council also made significant progress on finalising rules and raising the limit on input tax credit from 40 percent, though the final limit is not known yet.
Here are the responses on Twitter:
You Buy A Shoe at Rs 500 pay 5% #GST
— Third Eye View (@BrainandMoney) June 3, 2017
You Buy A Shoe at Rs 600 pay 18% #GST
You Buy Gold of Rs 1 lakh or 1Cr Pay only 3% #GST
??????????? pic.twitter.com/M5oA5AVNvZ
3% GST on gold...which effectively means one more tax slab under GST. GST in this form is going to be a disaster! @girishkuber
— Aditya Kulkarni (@AdityaKulkarni3) June 3, 2017
Gold at 3% GST
— sher khan (@sher_786) June 3, 2017
Diamonds at 3% GST
Rough/raw diamonds at 0.25%
Processed Food is at 18%
By taxing Gold & diamonds @3% GST council maintains tradition of implicit subsidy for rich and wealthy #GST
— anshuman tiwari (@anshuman1tiwari) June 3, 2017
3% gst is a good move. With rising gold prices and higher gst rates would have made people reluctant 2 buy gold. Watch #PCJEWELLER on monday pic.twitter.com/iD4qw0myUZ
— suresh panigrahi (@PanigrahiSuresh) June 3, 2017
3% #GST on gold, 18% on biscuits.What does brainy #Jaitley want us to consume more ? Inhuman socio science in disguise of pseudo economics
— SD (@ME_CALLING_SELF) June 3, 2017