How GST Will Impact Your Monthly Expenses?

  • Blog|GST & Customs|
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  • 2 Min Read
  • By Taxmann
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  • Last Updated on 25 June, 2021

GST will be one of the most crucial budget plans for the country. GST stands for Goods and Services Tax and will be affecting the products and services across the nation. While it affects all people across the country, the middle-class is no doubt going to be most affected by this.

The statutory tax rates under GST have been recently announced by the government and will become effective starting from 1st July, 2017. These taxes will be replacing all other applicable indirect taxes. While some products and good will get taxed more, some are going to get cheaper.

Under the current tax regime, various transactions and financial services attract service tax, which is going to be replaced by GST.  As of now, service tax is flat 15% across all type of services. However, under the GST, it will be divided into four slabs i.e. 5%, 12%, 18% and 28%.

You can also read: GST Overview

The GST Impact on Various Items:

Daily Consumable Items

Product

Change Per Unit

Change

MRP (Rs.)

Revised Rates

Milk

0

0%

45/ltr

45/ltr

Vegetables and Fruits

0

0%

50/kg

50/kg

Bread

0

0%

25/pack

25/pack

Basmati Rice

0

0%

70/kg

70/kg

Atta

0

0%

30/kg

30/kg

Pulses

0

0%

110/kg

110/kg

Packages Tea and Coffee

0

0%

150/pack

143/pack

Packaged Chicken

+9

2.58%

350/pack

359/pack

Edible Oil

+1

1%

125/ltr

126/ltr

Masala

-11

-3.83%

300/kg

289/kg

Packaged Curd

-8

-8.41%

100/pack

92/pack

Packaged Paneer

-10

-3.83%

250/pack

240/pack

Butter

+3

5.66%

50/pack

53/pack

Cheese

-1

-1.32%

50/pack

49/pack

Biscuit

-1

-10.92%

10/pack

9/pack

Mithai

-13

-3.83%

350/kg

337/kg

Bhujia

+8

2.58%

302.5/kg

310/kg

Chewing Gum

-1

-6.51%

10/pack

9/pack

Chocolate

-1

-6.51%

20/pack

19/pack

Corn Flakes

-16

-10.79%

150/pack

134/pack

Ice Cream

-3

-6.14%

45/pack

42/pack

Cold Drinks

-2

-10.32%

20

18

Juices

-1

-4.14%

30/pack

29/pack

Soap

-4

-15.26%

25/pack

21/pack

Toothpaste

-9

-15.26%

60/pack

51/pack

Hair Oil

-23

-15.26%

150/pack

127/pack

Shampoo

-20

-8.08%

250/pack

230/pack

Face Cream

-20

-6.51%

300/pack

280/pack

Medicine

-10

-10.13%

100/pack

90/pack

 

As of now, indirect tax on goods is slightly more than what it should be. Indian consumers are paying a “tax on tax” on each purchase they make, which in turn increases end cost of the products. Added to this is the arbitrary state tax that keeps varying.

Goods such as non-luxury cars, electronic, beauty products etc. can attract a VAT of 12.5% to 15% and excise duty of 12.5% depending upon the state you reside in. Due to this, a car is cheaper when purchased in Haryana as compared to Maharashtra, due to lower road tax rates.

Currently, it is assumed that a consumer pays around 25-26% tax above the production cost of the goods. GST bill is aimed to streamline all unpredictability in terms of tax, and bring in more equality to prices of all goods.

Currently, GST is predicted to reduce the overall budget of a normal household. It is expected to impact your household in a positive way, by reducing the cost of the most basic goods. If you have been tight on your budget lately, GST will prove to be one of the better government initiates that can benefit you. 

Author Bio: Santanu is a personal finance enthusiast, who shares experiences on insurance, investment, savings, home business and make money ideas through his blog MoneyGyaan.com.

 

Disclaimer: The content/information published on the website is only for general information of the user and shall not be construed as legal advice. While the Taxmann has exercised reasonable efforts to ensure the veracity of information/content published, Taxmann shall be under no liability in any manner whatsoever for incorrect information, if any.

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