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GST Reforms Have Reduced Tax Burden On People: Nirmala Sitharaman
GST Reforms Have Reduced Tax Burden On People: Nirmala Sitharaman
Addressing the Joint Conclave of Trade and Industries Association - 'Tax Reforms for Rising Bharat' in Chennai, she explained that the four-tier GST structure has now been simplified to just two slabs.
New Delhi: Union Finance Minister Nirmala Sitharaman on Sunday said that the Goods and Services Tax (GST) reforms have reduced the tax burden on people.
Addressing the Joint Conclave of Trade and Industries Association - 'Tax Reforms for Rising Bharat' in Chennai, she explained that the four-tier GST structure has now been simplified to just two slabs.
"Earlier, GST had four categories. Now, we have simplified it into two slabs - 5 per cent and 18 per cent. Items that were taxed at 12 per cent and 18 per cent have largely been moved to the lower 5 per cent bracket. For certain essentials, tax has been reduced to zero. This reform will significantly benefit all 1.4 billion Indians," FM Sitharaman said.
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The changes, the biggest overhaul since GST was introduced in 2017, will see the current 5 per cent, 12 per cent, 18 per cent and 28 per cent structure replaced with just two rates - 5 per cent and 18 per cent.
Additionally, a special 40 per cent tax bracket has been introduced for goods considered harmful or excessively luxurious, including cigarettes, tobacco, pan masala, soft drinks and high-end luxury cars.
Prime Minister Narendra Modi had hinted at the shift during his Independence Day address from the Red Fort, underlining the government's intent to ease the common man's burden before the festive season.
The revised rates will come into effect on September 22, just ahead of Diwali.
Government officials pointed out that the timing of the announcement was deliberate, keeping in mind the major festivals across regions.
While Diwali drives consumer demand for clothing and household goods in the south, Navratri and Durga Puja boost purchases in the north. The GST Council, with representatives from all states and Union Territories, unanimously approved the reform.
The Centre expects the simplified structure to immediately bring down prices of essential goods, spur consumption and boost economic activity.
Calling it a collective achievement, she said, "This is not just a tax cut - it is a victory for every citizen."
Source: ZeeNews
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