Clarifications On Applicable GST Rates on Certain Goods

Goods and Services Tax (GST) is a tax levied on the supply of goods and services in India. The GST Council, which is the governing body of GST, meets regularly to decide on the GST rates to be applicable to various goods and services. However, there have been some confusions and queries regarding the applicable GST rates on certain goods. In this article, we will try to provide some clarifications on the applicable GST rates on certain goods.

What is GST?

Before we delve into the details of the GST rates on certain goods, let us first understand what GST is. GST is a destination-based tax that is levied on the supply of goods and services in India. It is an indirect tax that was introduced in India in the year 2017. GST has replaced a number of indirect taxes such as Central Excise Duty, Service Tax, Value Added Tax (VAT), etc. GST is a comprehensive tax that is levied at every stage of the supply chain, from the manufacturer of goods and services to the end consumer.

Clarifications on Applicable GST Rates on Certain Goods

There have been some confusions and queries regarding the applicable GST rates on certain goods. Let us try to clear some of these confusions and provide some clarifications.

1. Textile and Apparel Products

There has been some confusion regarding the GST rates applicable to textile and apparel products. The GST Council has clarified that textile and apparel products will attract a GST rate of 5%. However, there are certain exceptions to this rule. For example, silk and jute yarns, raw silk, and handloom fabrics will attract a GST rate of 0%. Further, certain categories of apparel such as khadi fabric and clothing made from khadi will also attract a GST rate of 0%.

2. Tractors and Motor Vehicles

There has been some confusion regarding the GST rates applicable to tractors and motor vehicles. The GST Council has clarified that tractors will attract a GST rate of 12%, while motor vehicles will attract a GST rate of 28%. However, there are some exceptions to this rule. For example, electric vehicles will attract a GST rate of 5%, while hybrid vehicles will attract a GST rate of 15%.

3. Branded and Unbranded Food Products

There has been some confusion regarding the GST rates applicable to branded and unbranded food products. The GST Council has clarified that unbranded food products will attract a GST rate of 0%, while branded food products will attract a GST rate of 5%. However, there are certain exceptions to this rule. For example, packaged cereals and pulses will attract a GST rate of 5%, irrespective of whether they are branded or unbranded.

4. Gold and Silver

There has been some confusion regarding the GST rates applicable to gold and silver. The GST Council has clarified that gold and silver will attract a GST rate of 3%. However, there are certain exceptions to this rule. For example, gold and silver coins will attract a GST rate of 3%, while articles of goldsmiths' and silversmiths' wares will attract a GST rate of 5%.

Conclusion

In conclusion, the GST Council has clarified the applicable GST rates on certain goods. It is important for businesses to understand the GST rates applicable to their products and services in order to comply with the GST regulations. The above clarifications on the applicable GST rates on certain goods should help businesses understand the GST rates applicable to their products and services.