The central government has received approval from the state ministers’ committee for the proposed two-tier GST tax system. During the Independence Day celebration held last Friday, Prime Minister Narendra Modi addressed the nation, announcing a significant reduction in GST rates for goods during the Diwali festival. Specifically, the government plans to reform the GST tax into two tiers, with a minimum rate of 5 percent and a maximum rate of 18 percent. Currently, the GST tax rates are categorized into four slabs: 5 percent, 12 percent, 18 percent, and 28 percent. Among these, the government has planned to bring items under the 12 percent tax rate down to the 5 percent category, and to include 90 percent of the items under the 28 percent tax rate into the 18 percent tax slab.
This initiative aims to reduce the prices of goods, thereby providing relief to the common people from financial burdens. In this context, a committee of state ministers constituted by the GST Council has conducted discussions regarding this plan of the central government. The advisory meeting, chaired by the Deputy Chief Minister of Bihar, Samrat Choudhary, has granted approval for the acceptance of the central government’s new scheme. The central government has proposed the removal of the 12% and 28% tax rates under the GST category. We have discussed this matter. We have expressed our support for the central government’s proposal. We will recommend this to the GST Council. The GST Council will make the final decision. However, the central government has yet to announce when the next GST Council meeting will take place. It is anticipated that the meeting will occur at the beginning of September. This matter will be reviewed during the meeting. If the GST Council also grants approval, the two-tier GST tax system will be implemented nationwide. This could lead to a reduction in the prices of various goods ahead of Diwali.
