One year of GST: Sin products under new tax regime
Over Rs 19,000 crores have been collected as Central tax on tobacco till January in financial year 2016-17, while the figure for 2014-15 and 2015-16 stand at Rs 22,174 crores and Rs 19,977 crores, respectively.
One year back, the Central and the state government couldn't resist the temptation of levying higher GST slab on 'sin products' such as pan masala, tobacco and, aerated drinks along with luxury vehicles under the Goods and Services Tax (GST). 28 per cent i.e. the highest tax slab under GST has been imposed by the GST council on the above products. With this heavy tax imposed on these products, government is earning maximum revenue from them.
According to reports, over Rs 19,000 crores have been collected as Central tax on tobacco till January in financial year 2016-17, while the figure for 2014-15 and 2015-16 stand at Rs 22,174 crores and Rs 19,977 crores, respectively. After the implementation of GST, the revenue collected in the 2017-18 fiscal is Rs 3400 crore from the pan masala and tobacco products.
Small cars also fall under this higher tax slab with an additional cess of 1-13 per cent levied on the diesel and petrol cars. In a bid to reduce the consumption of aerated drinks, heavy tax has been levied on it. However, a total 44.8 per cent tax of incidence has been levied on pan masala.
Along with a special tax in the range of Rs 1,591-4, 170 per thousand cigarettes, a 5 per cent tax has been levied which takes the total cess beyond 29.4 per cent. A GST of 45.08 per cent to 85.12 per cent with cess ranging from 61-204 per cent has been imposed on tobacco and its products. With 109.2 per cent tax incidence, the highest cess has been put on smoking mixtures for pipes and cigarettes at the rate of 29 per cent.
WATCH THIS ZEE BUSINESS VIDEO HERE
Chewing gums, chocolates, custard powder, students' colours, paints, varnishes, wafers coated with chocolate perfumes, beauty products, sunscreen, shampoos, hair dyes, after-shave lotions and deodorants are also imposed with the highest slab of 28% GST.
Other than these some of the other products that fall under this slab are motorcycles with more than 350 cc engines, personal aircrafts and yachts. These attract 28.84 per cent tax while mid-segment and high-end luxury cars will call for a tax of incidence of 32.2 per cent.
Get Latest Business News, Stock Market Updates and Videos; Check your tax outgo through Income Tax Calculator and save money through our Personal Finance coverage. Check Business Breaking News Live on Zee Business Twitter and Facebook. Subscribe on YouTube.