How will GST affect your home budget?
Posted on: 19/Jun/2017 4:00:26 PM
It has been announced certain that the new mode of uniform taxing throughout the country, GST (Goods and Service Tax) will be implemented from 1st July.
GST will impact the prices of almost all items.
Thus, apart from the country and the state budget, GST will make its impact on our home budgets as well. Let us know the impact item wise
Cooking oil:
Hair oil is under GST slab 18%, Other oils, coconut oil and refined oils are under the 5% GST slab. As an example, if the basic price is Rs. 200, the prevailing tax is Rs. 23. The tax under GST will be Rs. 10.
Hotel Food:
If you are a regular hotel visitor, you need to pay higher taxes. So, look for other avenues where you can save your money.
GST slab for non-air-conditioned hotels – 12%. GST for 5-star hotels – 28%. Example: Basic Price – Rs. 2000. Prevailing taxes – Rs. 270. Under GST – Rs. 360.
Clothes:
Due to the present crisis encountered by the textile industry, the GST council has reduced the prevailing tax rate for clothing items costing below Rs. 1000 from 12% to 5 %. Example: Basic Price – Rs. 2000. Prevailing tax – Rs. 130. GST – Rs. 240.
Movies:
Under GST, tax concession is given to the single screen theatres in small towns. However, the price of the movie ticket in major cities will go up from Rs. 120 to Rs. 145. Example: Basic Price – Rs. 1200. Prevailing taxes – Rs. 360. GST – Rs. 336.
Life Insurance:
GST council has made some important changes in the taxes for insurance policies, Under the prevailing scheme, only the short-term insurance plans and non-life insurance plans were taxed. However, this has been changed. Example: Basic price – Rs. 15000. Present taxes – Rs. 2250. GST – Rs. 2700.
Consumer durable gadgets:
There are no major changes in the taxes for items such as fridge, washing machine, and weight-goods section. Example: Basic Price – Rs. 20000. Present taxes – Rs. 5300. GST – Rs. 5600.
Telecom:
The customers who have 2-telephone connections and 1 DTH connection will have to pay more taxes. Example: Basic Price – Rs. 2500. Present Taxes – Rs. 375. GST – Rs. 450.
Automobile:
Under GST, the tax for SUV cars are down from 55% to 43%. For the small car, it is down to 29-30%. Example – Basic Price – Rs. 4.75 Lakhs. Present taxes – Rs. 1.43 Lakhs. GST – Rs 1.38 Lakhs
Hotels:
If you pay a room rent of below Rs. 1000 per day while on a tourist trip, there is no need to pay any tax. However, the tax goes up for the higher rent slabs. For room rents of Rs. 5000 and above, GST is 28%. Example: Basic price – Rs. 7000. Present taxes – Rs. 1400. GST – Rs. 1960.
Train travel:
Local train fares and sleeper class tickets are not affected by GST. However, the 1st Class and A/c class passengers will need to pay more under GST. Example: Basic price – Rs. 3000. Present Taxes – Rs. 131. GST – Rs. 150.
Gold jewellery:
Under GST, the prices of gold jewellery will be up. As per this, GST is under the 3% slab. The making charges will be under the GST slab of 5%. Example: Basic price – RS. 60000. Present taxes – Rs. 1800. GST – Rs. 2000.
Air travel:
As the central government has the policy to encourage air travel and increase the number of air passengers, a tax concession has been offered in the sector of air travel. However, this has created a larger gap between the fares in economic class and the business class. Example: Basic Price – Rs. 5000. Present taxes – Rs. 300. GST – Rs. 250.
