Conceding a year-long demand, sanitary pads were on Saturday exempted from the goods and services tax as the GST Council reduced rates on an array of appliances and products of daily use. All leather items will now attract a GST rate of 18 percent, while footwear priced below Rs 1,000 will be taxed at 5 percent.
Sources said rate cuts and certain clarifications will have revenue impact of Rs 10,000 crore-Rs 11,000 crore annually.
The minister also said that there would be a special meeting of the GST Council on August 4 to discuss in detail ways to promote MSME and small industries and to promote digital payment systems among more people, especially the rural and the poor. As per reports, in January a group of students had written notes to PM Modi on sanitary pads and had sought an exemption from GST.
GST on 17 items used by middle class viz paints, refrigerators, washing machines, vacuum cleaners, storage water heaters, TVs up to 68 cm was reduced from 28% to 18%.
Goyal said radio-frequency identification tags would soon be linked with the Goods and Services Tax Network in order to reduce the harassment of transporters. The government is likely to implement it by the end of this year.Also in the pipeline is reduction of GST on 30 odd items including sanitary napkins, handlooms and handicrafts, among others. "I think the 28 per cent tax slab should be done away with". The minister added that return forms would be simplified into different formats for composite dealers, business-to-business dealers and business-to-consumer dealers.
E-commerce platforms and traders dealing in goods that are liable for GST will have to register for GST.
Apart from sanitary napkins, the GST Council also declared stone/marble/wood idols, rakhis, sal leaves, phulbhari jhadu to be exempted from GST. Keeping this in mind, GST Council in October, 2017 had temporarily suspended RCM, as it was increasing compliance burden on taxpayers. He will not have to file any more returns.