The GST Council has approved GST Rates announced Finance Minster Shri Arun Jaitley on 1st day of 4th GST Council Meeting on 03.11.2016

Summary of things announced by Finance Minister is as follows:

There were two major thing: 1) Rate Structure & Compensation Formula 2) Cross Empowerment. Cross Empowerment will be discussed tomorrow i.e. 04.11.2016. Day-1 was devoted for finalising Rate Structure & Compensation formula.
Tax Rates finalised are 5%, 12%, 18% & 28%.
Cess would be charged on some items with sunset clause of 5 years.
Zero Tax Rate Items would constitute 50% of Common usage items.

To save impact of inflation on common man food grains would be exempt.
40% Tax Rate will not be there.
Rate of 28% will apply to several items particularly white goods & others now attracting effective tax rate of 30-31% Even though these goods 12.5% Excise Duty and 14.5% VAT, net effective rate comes to 30-31% taking into account the cascading effect.
Discussion of Gold was not done. It will be finalised last.
There is difference between Cars & Luxury Cars.
- Cars will come in Automobile whereas Luxury Cars will be taxed at Higher Rate.
- Automobile Rates are 28%.
- Luxury Car will have higher Rate.
- Luxury Car not defined.
Lower Rate to be kept at 5% though originally proposed was 6%.
Fitment or categorization of items for each slab will be done by officials and will then be approved by the GST council.
All Finance Ministers supported the proposal. Everything is going by consensus. Till date no voting for any item has been done.

Link : http://gstpanacea.com/gstupdates/gst-council-meet/

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