In the 23rd GST Council meeting held on 10th November, a number of major decisions were taken; the most significant of which was eating out at restaurants will be much less expensive. The Council slashed the rate to 5% from the earlier 18% irrespective of turnover or whether the restaurant has air-conditioning or not.
In keeping line with development, restaurants would not be denied the benefit of input tax credit as they were not purportedly not passing on the benefit to customers. However, restaurants in five star hotels charging at least Rs 7,500 would still pay 18 per cent GST.
Apart from this, 178 items were dropped from the highest tax bracket to 18%. This list included shampoo, furniture, detergents, mattresses, marbles, ceramics, flooring, and toiletries.
These changes would be enforced from 15th November onwards. Now only 50 items remain in highest tax bracket of 28 per cent.
The rate on tanks and armored vehicles was also lowered to 12% from the earlier 18%. This rate cut also included 13 other items namely, pasta, curry, diabetic food, and condensed milk. Six items including puffed rice, chikki, chutney powder, and fly ash will now be charged at 5% GST from the previous 18%. Also, eight items such as desiccated coconut, idli, dosa, sambar, and worn clothing would come under the 5% tax slab from the previous 12%.
Other items which benefited from rate cuts include aircraft engines (18-28% to 5%), aircraft tyres (28% to 55), and aircraft seats (28% to 5%).
Prime Minister Narendra Modi said, “The recommendations made by the GST Council will further benefit our citizens and add strength to the GST. These recommendations are in the spirit of continuous feedback we are getting from various stakeholders on the GST’.