oppn parties GST Council Meet: Boost To Tourism and Big Relief To Small Businesses

News Snippets

  • EMI's set to rise after the RBI hikes key policy rate
  • Calcutta HC says that the right to privacy does not end with the death of a person
  • Supreme Court says that a delayed order of preventive detention makes it invalid
  • Shashi Tharoor posts an erronous map of India in his manifesto, rectifies the error after criticism
  • Sonia Gandhi to take a call on who will be Rajasthan chief minister
  • Mallikarujun Kharge to be the new candidate to oppose Shashi Tharoor in the Congress presidential elections
  • RBI says that the September inflation rate may be higher than 7%
  • RBI hikes key rates by 50bps, downwardly revises FY23 growth rate to 7% from 7.2% earlier
  • Stocks recover well on Friday: Sensex gains 1016 points to0 57426 and Nifty 276 points to 17094
  • Mirabai Chanu wins gold easily at the National Games
  • In a first, the Supreme Court recognizes marital rape, although for the limited purpose of allowing married women the right of abortion up to 24 weeks if they conceived as a result of forced sex by their husbands
  • Air India cuts discounts on base fare to students and senior citizens from 50% to 25%
  • Mallikarjun Kharge and Digvijay Singh are being touted as frontrunners to take on Shashi Tharoor in the elections for the post of Congress president
  • Sonia Gandhi will decide who will be Rajasthan CM if she feels there is a need to change guard after the near-rebellion by MLAs in the state
  • Ashok Gehlot bowed out of the race for being Congress president after meeting Sonia Gandhi
RBI hikes key rates by 50bps, stocks jump and recover 50% of the losses incurred in the last few session
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GST Council Meet: Boost To Tourism and Big Relief To Small Businesses

By Linus Garg

About the Author

Sunil Garodia Linus tackles things head-on. He takes sides in his analysis and it fits excellently with our editorial policy. No 'maybe's' and 'allegedly' for him, only things in black and white.

The GST Council meet in Goa on Friday did not meet the expectations of the automobile industry. It did not announce the rate cut that the industry, along with biscuit manufacturers and some other sections of the FMCG industry was expecting. Instead, in an effort to boost tourism, the council rationalized rates in the hotel industry to make them at par with those prevailing across the globe. This was needed as India is emerging as a prominent tourist destination (as also for medical tourism). The council cut the rates of rooms with tariff above Rs 7501 from 28% to 18% and those with tariff between Rs 2501 to Rs 7500 to 12% from 18%. Rooms below Rs 1000 remain GST-free while those between Rs 1001 and Rs 2500 will continue to attract 12% as before. Hence, the mid-segment has been broadened to include rooms from Rs 1001 to Rs 7500 and will now attract 12% GST. The tax rate on outdoor catering has also been cut to 5%. But travelers have to be prepared to shell out more for caffeinated drinks, including energy drinks, as they will now attract 28% GST instead of 18% before and an additional compensation cess of 12%. The government is trying to discourage the consumption of such drinks as they are considered sin goods.

The other rationalization of taxes was in job work where GST on job work in diamond was reduced from 5% to 1.5% and in engineering (other than bus body building) from 18% to 12%. In order to discourage the use of single-use plastic and support alternatives, the council brought plates and cups made of leaves, flowers and barks to zero percent from the 5% currently imposed on them. But the railway wagon, coaches and rolling stock industry was in for a surprise as the GST rate on them was upwardly revised from 5% to 12% without the accumulation of ITC. But the boldest move by the council was for small traders. In a major relief, business entities with a turnover of up to Rs 2 crore were exempted from filing annual returns. This is expected to benefit a large number of businesses.