The Central government has made certain changes in the Goods and Services Tax (GST) regime – which will come into effect from 1 January. These changes were declared by the Central Board of Indirect Taxes and Customs (CBIC) on 18 November.
How will the new rules affect the consumers? Here's a short primer.
What will get costlier?
Footwear
Textile
The prices of clothes and footwear will increase as the GST rate on these items will increase from 5 percent to 12 percent, starting from 1 January 2022.
Clothes and footwear which cost less than or equal to Rs. 1000, will have a GST rate of 12 percent.
Which fabrics will become costlier?
Woven goods
Synthetic yarn
Tents fabrics
Blanket fabrics
Even table clothes and table napkins will have a GST rate of 12 percent.
Is there an exception?
Yes, cotton products will still be at 5 percent GST.
What is the GST rule on passenger services like Ola, Uber?
Starting next year, there will be a 5 percent GST imposition on auto rides booked online through Ola or Uber. However, the auto-rickshaws caught from the street will remain free from GST.
On the other hand, the prices of cabs will get lower as the earlier GST rate of 6 percent will now come down to 5 percent.
How will the GST imposition on cabs affect me?
You will have to pay more if you book an auto-rickshaw online but there will be a slight decrease in the prices of cabs booked online.
Will GST also be levied on Zomato, Swiggy?
Yes, from 1 January 2022, the food delivery businesses like Zomato, Swiggy, etc. will have to collect and deposit the GST charged from the consumers. These apps will be liable to collect and deposit 5 percent GST on restaurant services supplied through them from 1 January.
How will the GST on food delivery businesses affect me?
It will not. This will not directly affect the consumers as you will not have to pay any extra charges.
This 5 percent tax is currently collected by the restaurants, which will be shifted to the food delivery businesses staring next year.
How will the new GST rules affect big businesses?
Businesses with an annual turnover 5 crore or more, have to submit two monthly returns:
GSTR-3B (self- declared monthly return)
GSTR-1 (sales invoice of monthly return)
If the returns mentioned in GSTR-3B and GSTR-1 do not agree then government officials will be sent for collection of the unpaid GST, without any prior show-notice.
(Inputs from Firstpost, The News Minute, and DNA)
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