Government Amends GST Rates: Key Highlights

Reduced Tax on Footwear: Footwear with a sale value not exceeding Rs. 1000 per pair now attracts a reduced GST rate of 12%. This change aims to make affordable footwear more accessible.

Dynamic Tax Structure: The government introduces a dynamic tax structure based on taxpayers' aggregate turnover. Those with turnover above Rs. 5 crores face 9% GST for the first 15 days post the due date, increasing to 18% thereafter.

Tax Exemptions for Small Businesses: Businesses with an aggregate turnover up to Rs. 5 crores in the previous financial year enjoy exemptions during the first 15 days after the due date, with a gradual increase to 18% afterward.

Focused Tax Relief for Specific Sectors: Amendments in Schedule I (5%) and Schedule II (12%) include adjustments in tax rates for various products, such as edible oils, essential commodities, and certain metals.

Clarity on Taxation of Tender Coconut Water: Tender coconut water, excluding those with a registered brand name or enforceable rights, is exempt from GST for the initial 15 days post the due date. A 9% tax applies for the subsequent 15 days, followed by an 18% rate.

Streamlined Notifications: The amendments supersede earlier notifications, bringing clarity to the GST structure. The changes are effective from January 1, 2022, providing businesses with updated guidelines for compliance.

Elimination and Substitution: The notification eliminates certain entries and substitutes others, providing a streamlined and comprehensive approach to GST rates across various categories.