GST rates to be cut on 20 litre water bottles and bicycles, up on shoes, watches

The Group of Ministers (GoM) for GST rate rationalisation has decided to lower the tax rates on 20-litre packaged drinking water bottles, bicycles and exercise notebooks to 5% from 18% earlier, according to a PTI report which cited unnamed officials. HT couldn’t independently verify the information.
However, the GoM also suggested to raise taxes on high-end wrist watches costing over ₹25,000 and shoes costing over ₹15,000, to 28% from 18% earlier according to the report, which added that all of the changes together by the GoM headed by Bihar Deputy Chief Minister Samrat Chaudhary would result in a revenue gain of ₹22,000 crore.
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The GoM is a committee formed by the Goods and Services Tax (GST) Council to address specific issues.
The six-member GoM on GST rationalisation also included Uttar Pradesh Finance Minister Suresh Kumar Khanna, Rajasthan Health Services Minister Gajendra Singh, Karnataka Revenue Minister Krishna Byre Gowda, and Kerala Finance Minister K N Balagopal.
The GoM on GST rationalisation was formed this time after the average GST rate fell below the revenue neutral rate of 15.3%, according to the report.
In its previous meeting on Saturday, the GoM had discussed tax rate tweaks on more than a 100 items.
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The GST on bicycles costing less than ₹10,000 could also get reduced to 5% from 12% earlier, according to the report.
Certain items in the 18% slab like hair dryers, hair curlers, and beauty or make-up preparations could get taken into the 28% bracket, the report read.
GST is currently a four-tier tax structure with 5%, 12%, 18%, and 28% slabs, with essential items being exempted or taxed the lowest and luxury items being taxed the highest.
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