After cutting Goods and Services Tax (GST) over 178 of daily-used items last week, Finance Minister Arun Jaitley on Monday ruled out the possibility of a single GST rate but he said there was a scope for further rationalisation of tax rates under the new indirect tax regime.
“It is juvenile politics to link GST rate rationalisation with elections or political demand. Those seeking a single GST rate have no understanding of tariff structure,” Jaitley said.
The Finance Minister, however, did not rule out rationalisation of tax rates under goods and services tax. "Revenue buoyancy will decide the course of rationalisation," said Jaitley.
In the biggest GST rejig yet, tax rates on over 200 items, ranging from chewing gum to chocolates, to beauty products, wigs and wrist watches, were on Friday cut to provide relief to consumers and businesses amid economic slowdown.
As many as 178 items of daily use were shifted from the top tax bracket of 28 percent to 18 percent, while a uniform 5 percent tax was prescribed for all restaurants, both air- conditioned and non-AC, Finance Minister Arun Jaitley said after the GST Council meeting.
The all-powerful GST Council pruned the list of items in the top 28 per cent GST slab to just 50 from current 228. So, only luxury and sins goods are now only in highest tax bracket and items of daily use are shifted to 18 per cent.