India GST rate cut plans
India is considering removing many daily essential goods form the top Goods & Services Tax (GST) band of 28%.
GST was launched in India on 1 July 2017, replacing many overlapping consumption taxes including VAT, CENVAT and Service Tax. Whilst there remain many issues with the new indirect tax, including the reconciliation process between purchase and sales invoices, the new tax implementation has gone relatively smoothly.
This has prompted Prime Minister Modi to indicate that a reduction in GST for essentials would be possible on the back of higher than expected GST receipt. The government is also considering to lower the 18% GST levied in air-conditioned restaurants to the 12% due in all other restaurants.
There are presently four main GST rates in India: 28%, 18%, 12% and 5%.
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