The government has decided to impose 18 per cent GST on manmade fibre and synthetic yarn."The 18 per cent service tax will impact a lot. This is a big worry as presently there is no tax on job work. It will mainly affect the small and medium scale exporters engaged in job work activities. But the welcoming news in this respect is that the Council in its 16th meeting held on 11th June 2017 fixed the tax rate on job workers in textile, diamond processing, leather, jewellery and printing at 5 per cent, as against the normal 18 per cent GST rate for services.
On Sunday, 11th June, 2017 the GST council has revised tax rates on 69 products. The weighted average of the newly decided rates are significantly lower than what is paid today. The new rates will give relief to many different social makeups.Under the revised GST rates, the household items as packaged food items like pickles, ketchup, toppings are reduced from 18 to 12 percent GST.
The GST council's decision to impose a 3% GST on gold, silver jewellery and processed diamonds, which is higher than the industry estimate. The challenge is at the manufacturing end because 90% of gold jewellery making is in the unorganised MSME sector. On the retail front, almost 30% of the jewellery sector is organised. The high duty can also lead to increased smuggling of gold, say experts.
GST has put mixed impact on tourism industry. The GST Rates passed by the GST Council in India has recently updated the tourism and hospitality industry. The GST council has finalised, that it will be applied on their services based on the tariffs and turnover they draw.
In the last 20 years, 3,21,428 farmers have committed suicide. Many studies had found that the crisis had hit their families badly. But there are many problems to identify such families and extending support to these families to overcome the crisis of losing the bread winner and pay back huge debts.GST regime may increase the cost of agriculture production.The combined increase in prices of fertilisers, pesticides and tractors will increase burden on farmers.