No more 12%, 18% GST slab? Here’s what FM Jaitley says could happen

The GST currently has five tax slabs — 0%, 5%, 12%, 18%, and 28%. With the latest round of rate rationalisation, only 28 items left in the 28% bracket.

December 24, 2018 17:58 IST

The GST currently has five tax slabs — 0%, 5%, 12%, 18%, and 28%. With the latest round of rate rationalisation, only 28 items left in the 28% bracket.

After a massive rate rationalisation on Saturday, bringing several items into lower GST rate brackets, Finance Minister Arun Jaitley has now given an insight into the future of the indirect tax regime said that 12% and 18% tax brackets may be merged into one.

He said that India will eventually have a standard tax rate, which can be created by merging 12% and 18% tax rates, for commonly used goods. However, this does not mean a single GST rate. Essential items will continue to be taxed at 0% and 5%, while luxury, sin and demerit goods will attract a higher tax rate.

In a Facebook post, Arun Jaitley said, “A future roadmap could be to work towards a single standard rate instead of two standard rates of 12 per cent and 18 per cent… It could be a rate at some mid-point between the two.

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