9 Nov 2016
INDIA: Four-Tier Structure Adopted for 2017 Goods and Services Tax
A four-tier structure has been approved for the Goods and Services Tax (GST), scheduled to be introduced on 1 April next year. The tax will be levied at the rates of 5% (mass consumption items, including spices, tea, and mustard oil), 12% (processed foods), 18% (soaps, oil, toothpaste, smartphones, and refrigerators) and 28% (white goods, cars, tobacco and aerated drinks). Essential items – such as rice – will be wholly exempt from the tax.
The new levy is intended to harmonise India’s fragmented indirect tax system, while also stimulating foreign investment and improving the ease of doing business in the country.
For more details, see INDIA: Legislation Set to Harmonise Indirect Tax System and Boost Ease of Doing Business.