Tax rates for gold and gold jewellery likely to be decided at GST Council's June 3 meeting instead.
Srinagar: The all-powerful GST Council on day two of its fourteenth meet today finalised tax rates for services under the Goods and Service Tax (GST) regime, scheduled to kick-in from July 1.
It was expected that the Council will also finalise tax rates for gold, gold jewellery today itself but it has put the decision on hold till its next meeting scheduled in June this year. Earlier, some industry players had demanded gold be put under lowest tax bracket of 5 per cent.
The Council has clarified that two key social elements that were taken up for discussion today -- healthcare and education -- would be exempt from any tax under the new indirect tax regime.
Talking to media in Srinagar, Finance Minister Arun Jaitley said that the 'One Nation One Tax' would be a consumer friendly taxation system. All the cereals like rice, wheat and pulses will get cheaper, he said.
"There are hardly any areas where rates have been hiked," Jaitley said who added that the GST Council has tried either to retain the earlier tax rates or has brought them down.
Apart from that, rail, road and air transport services have been put under lowest 5 per cent tax bracket and according to Jaitley, "There are certain services which have been exempted from the tax net". Taxi aggregators like Ola and Uber cab services providers will attract lowest 5 per cent GST tax rate, Jaitley said.
Jaitley further informed that there will be a 12 per cent service tax on non-AC restaurants and service tax in restaurants in five-star hotels will be same as that in ordinary hotels. "Service tax on AC restaurants with liquor licence will be at 18 per cent," he informed. "Five-star hotels to levy 28 per cent; hotels with tariff of Rs 1,000-2,500 to pay 12 per cent rate," Jaitley added.
Earlier in the day, Kerala Finance Minister Thomas Issac who is a member of the GST Council had said that services will also attract a four-tier tax slab similar to goods that are being taxed at 5, 12, 18 and 28 per cent. The tax rate on gold has not been finalised yet, he said, adding that the Council will meet again on June 3.