New GST Rates- How will the new rates impact prices?

New GST Rates from 18.07.2022!

New GST rates on pre-packed food items

The 47th meeting of the GST Council was held last month in Chandigarh. The meeting was chaired by the Union Finance Minister of India, Nirmala Sitharaman. The rates on several items were hiked, and the new rates will come into effect on 18th July 2022, Monday. The government has removed tax exemptions on some items, while the GST rate has increased on some items. The duty inversion on goods was also removed in the cases where the input tax is higher than the output tax. Read this blog to know the latest GST rates on various items.

Related: How GST changes your everyday life?

Updates on GST Rates

The GST rates have been updated, and the new rates will come into effect on Monday, 18th July 2022. Here are the updated rates of GST: -

  1. Pre-packaged food items like Atta, Paneer, and Curd- A 5% GST rate has been introduced for these products. 
  2. Hotel rooms with room rent of up to Rs 1000- A GST rate of 12% will be charged on hotel rooms with rates of less than Rs 1000 per room. Earlier the GST rate was zero.
  3. Hospital rooms with rent above Rs 5000 except ICU rooms- If you book a hospital room with rent of over Rs 5000, you are liable to a GST rate of 5%. For ICU rooms, the GST is not applicable. Earlier, GST was not applicable on hospital rooms.
  4. Tetra packs- The GST rate will now be 18% on tetra packs from the earlier rate of 12%.
  5. LED Lamps, Inks, Skimmers, Ladles, Knives, Blades, Cake Servers, etc.- The new GST rate is increased from 12% to 18%.
  6. Solar Water heaters- Solar water heaters are expensive, with the GST rate hiking from 5% to 12%. 
  7. Work contracts for roads, metro, bridges, railways, crematorium, and effluent treatment plant- The rate of GST is hiked to 18% from the earlier rate of 12%.
  8. RBI, IRDA and SEBI services- The GST rate is 18%. Earlier, these services were exempt from GST.
  9. Renting a residential unit to a business entity- This will attract a GST rate of 18%. Earlier, it was exempt from GST. 
  10. Bio-Medical Waste Treatment Facilities- The new GST rate is 12% from the earlier exempt status.

Not everything is getting expensive. A few items are getting cheaper as well. The items getting cheaper are: -

  • Ostomy appliances and the transport of goods and passengers by ropeways- The GST rate is reduced from 12% to 5%.
  • Renting trucks/carriage, including fuel- The GST rate is reduced from 18% to 12%.
  • Air travel to and from the North-Eastern States and Bagdogra- The category has been exempted from GST.
  • Electric Vehicles- GST rate has been reduced to 5%. Earlier, the lithium-ion battery was taxed at 18%.

Related: Everything you need to know about the GST return forms

In its 47th meeting, the GST council hiked the GST rate on many items. The GST rate was reduced on some items as well. The meeting was chaired by Nirmala Sitharaman, the Union Finance Minister of India. The new GST rates are applicable from 18th July 2022, i.e. Monday.

To read the latest articles on tax, visit our Tax Planning section. 

The 47th meeting of the GST Council was held last month in Chandigarh. The meeting was chaired by the Union Finance Minister of India, Nirmala Sitharaman. The rates on several items were hiked, and the new rates will come into effect on 18th July 2022, Monday. The government has removed tax exemptions on some items, while the GST rate has increased on some items. The duty inversion on goods was also removed in the cases where the input tax is higher than the output tax. Read this blog to know the latest GST rates on various items.

Related: How GST changes your everyday life?

Updates on GST Rates

The GST rates have been updated, and the new rates will come into effect on Monday, 18th July 2022. Here are the updated rates of GST: -

  1. Pre-packaged food items like Atta, Paneer, and Curd- A 5% GST rate has been introduced for these products. 
  2. Hotel rooms with room rent of up to Rs 1000- A GST rate of 12% will be charged on hotel rooms with rates of less than Rs 1000 per room. Earlier the GST rate was zero.
  3. Hospital rooms with rent above Rs 5000 except ICU rooms- If you book a hospital room with rent of over Rs 5000, you are liable to a GST rate of 5%. For ICU rooms, the GST is not applicable. Earlier, GST was not applicable on hospital rooms.
  4. Tetra packs- The GST rate will now be 18% on tetra packs from the earlier rate of 12%.
  5. LED Lamps, Inks, Skimmers, Ladles, Knives, Blades, Cake Servers, etc.- The new GST rate is increased from 12% to 18%.
  6. Solar Water heaters- Solar water heaters are expensive, with the GST rate hiking from 5% to 12%. 
  7. Work contracts for roads, metro, bridges, railways, crematorium, and effluent treatment plant- The rate of GST is hiked to 18% from the earlier rate of 12%.
  8. RBI, IRDA and SEBI services- The GST rate is 18%. Earlier, these services were exempt from GST.
  9. Renting a residential unit to a business entity- This will attract a GST rate of 18%. Earlier, it was exempt from GST. 
  10. Bio-Medical Waste Treatment Facilities- The new GST rate is 12% from the earlier exempt status.

Not everything is getting expensive. A few items are getting cheaper as well. The items getting cheaper are: -

  • Ostomy appliances and the transport of goods and passengers by ropeways- The GST rate is reduced from 12% to 5%.
  • Renting trucks/carriage, including fuel- The GST rate is reduced from 18% to 12%.
  • Air travel to and from the North-Eastern States and Bagdogra- The category has been exempted from GST.
  • Electric Vehicles- GST rate has been reduced to 5%. Earlier, the lithium-ion battery was taxed at 18%.

Related: Everything you need to know about the GST return forms

In its 47th meeting, the GST council hiked the GST rate on many items. The GST rate was reduced on some items as well. The meeting was chaired by Nirmala Sitharaman, the Union Finance Minister of India. The new GST rates are applicable from 18th July 2022, i.e. Monday.

To read the latest articles on tax, visit our Tax Planning section. 

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