The Revenue Department has come up with draft recommendations for tax rates for services under the new GST regime. The proposed tax rates are as follows:
- GST on telecom, banking, financial services, aviation is proposed to be at 18%
- DTH and restaurant dining will also be taxed at 18%
- Education and healthcare sector to be taxed at 12%. These are the only two major sectors to see a lower tax rate.
- Affordable housing will also remain at 12%
These rates will be up for discussion in the next GST council meet on February 18. Talking about the plan so far, Financial Services Secretary Hasmukh Adhia said that the council was well on track to implementing GST. He also said that the government hopes to finalise the law in the next meeting.
How GST will impact different businesses
More will become clear only as the government moves forward on implementation. As of now, experts predict that the cost of services will go up due to higher GST rates, while goods will probably remain the same. Essential goods do not come under GST.
As a business, here’s what you can do to minimise the windfall from GST implementation:
- Get your enrollment done on time. To read more about the enrollment process and its relevance, Click here.
- Plan your logistics and warehousing requirement carefully. To read our detailed guide on impact analysis on logistics and warehousing, Click here.
- Adopt such platforms, technologies which will enable your business to be GST-compliant. Click here to get all updates and access a pool of GST Calculators.
If you’re into the restaurant business our report on the impact of GST on this sector might be of help to you. Small and medium enterprises, which is a growing sector of the Indian economy will also see a major impact from GST implementation. Learn all about that here.