Advertisement

  • News
  • Columns
  • Interviews
  • BW Communities
  • Events
  • BW TV
  • Subscribe to Print
BW Businessworld

GST To Ease Tax Rates On Medicaments, Smart Phones, Medical Devices

The present total tax incidence on smart phones works out to more than 13.5%. As against this, the proposed GST rate for smart phones is 12%.

Photo Credit :

1495432320_YYt8WV_GST.jpg

The roll out of Goods and Services Tax (GST) will bring benefits to the consumers due to reduced tax rates on various commodities such as packaged cement, medicaments, smart phones, and medical devices, informed the finance ministry in an official statement.

Packaged cement attracts central excise duty of 12.5 percent + Rs 125 PMT and standard Value Added Tax (VAT) rate of 14.5 percent. At these rates, the present total tax incidence works out to more than 29 percent.

If the tax incidence, on account of Central Sales Tax (CST), octroi, entry tax, etc., is included, then the present total tax incidence would work out to more than 31 percent. As against this, the proposed GST rate for cement is 28 percent.

There will be lesser tax burden in case of medicaments, including ayurvedic, unani, and siddha, homeopathic or bio-chemic systems also. Medicaments, in general, attract 6 percent central excise duty and 5 percent VAT.

Further, CST, octroi, entry tax, etc. are also applicable in general. At these rates, the present total tax incidence works out to more than 13 percent. As against this, the proposed GST rate on medicines, including ayurvedic medicines, is 12 percent.

The Ministry added, smart phone attracts 2 percent central excise duty (1 percent excise duty + 1 percent NCCD). VAT rates vary from State to State from 5 percent to 15 percent. Weighted average VAT rate on smart phones works out to about 12 percent.

Thus, the present total tax incidence on smart phones works out to more than 13.5 percent. As against this, the proposed GST rate for smart phones is 12 percent.

Similarly, medical devices, including surgical instruments, in general attract 6 percent central excise duty and 5 percent VAT.

Along with CST, octroi, entry tax, etc., the present total tax incidence on them works out to more than 13 percent. As against this, the proposed rate under GST is 12 percent.


sentifi.com

Top themes and market attention on: