Four tier GST Rate structure is likely to be proposed in the 3-day GST Council meeting which kicks off today. The structure would be on following lines:
6% – Precious metals, gems, stones, essential food items etc.
12% – FMCG, Non-essential food items etc.
18% (standard GST Rate) – It would cover majority of goods and services
26% – Some specific items including luxury cars would get covered.
“We are currently looking at four tax slabs, with the highest incidence of tax at 26 per cent. It is lower than the 40-per cent rate proposed for very limited demerit items (by a committee led by the Chief Economic Adviser, Arvind Subramanian). A lower rate of 26 per cent can be imposed on more items. This will address concerns of the states, too,” said a government official.
However, peak tax rate of 40% has not been ruled out.