GST relief for common man soon? The Goods and Services Tax (GST) slabs may soon be revamped and rationalised by the government to provide relief to the middle class. Media reports quoting official sources suggest that the government is planning to lower the GST rates for commonly used household items.The current GST framework operates with four primary tax brackets – 5%, 12%, 18%, and 28%, alongside distinct rates for specific items such as precious metals and supplementary cess on sin goods.In the present structure, the 5% category encompasses 21% of GST items, the 12% bracket covers 19%, whilst 18% applies to 44%, and the highest rate of 28% is applicable to 3% of items.The step, if taken would come on the back of the revamp of the new income tax regime announced by FM Nirmala Sitharaman in this year’s budget. According to the latest income tax slabs under new regime, individuals earning up to Rs 12 lakh taxable income will have to pay zero tax from financial year 2025-26.
GST Relief For Common Man, Middle Class?
The lower GST tax slabs could potentially include items like pulses, rice, besan etc. Other reports suggest that tax rates on toothpaste, kitchen utensils, footwear and ready made garments in a certain price range may also come down.There is also buzz that the 12% GST tax slab may either be removed, reduced, or certain items in the 12% category may be shifted to the 5% GST tax bracket.In May, ET had reported that the government has started new deliberations to overhaul the GST framework, aiming to enhance its simplicity and modify the existing rate categories.High-level governmental consultations have focused on strategies to streamline the taxation system and boost its operational efficiency, the financial daily had reported.Also Read | Double in just 5 years! Gross GST collections hit record high of Rs 22.08 lakh crore in FY25; average monthly number at Rs 1.84 lakh crore Meanwhile, government data released on Monday revealed that gross GST collections reached a record Rs 22.08 lakh crore in fiscal year 2024-25, showing a twofold increase from Rs 11.37 lakh crore in FY21.The gross GST revenue for 2024-25 demonstrated a 9.4 per cent increase compared to the previous financial year, achieving its highest-ever figure of Rs 22.08 lakh crore.The monthly collection average increased to Rs 1.84 lakh crore in FY25, showing substantial growth from Rs 1.68 lakh crore in FY24 and Rs 1.51 lakh crore in FY22.The GST system has experienced significant expansion in its taxpayer base, with registered taxpayers increasing from 65 lakh in 2017 to more than 1.51 crore over an eight-year period.
