Structure of GST and its effect on Country’s Economy –

GST is an indirect tax introduced in India in 2017 levied on the goods and services
which is supplied. Goods and Service Tax are divided into 5 Tax Slabs.
It formulates the collection of tax easier and these slabs are 0% - 28%. However, petroleum
products, electricity and alcoholic drinks are not taxed under GST and as a replacement for
are taxed individually by the individual state governments, as per the previous tax regime.
There is a unique rate of 0.25% on semi-precious stones and rough precious and 3% tax on
gold. In addition, a cess of 22% or other rates on top of 28% GST applies on a few items like
aerated drinks, luxury cars, and tobacco products. Before the implication of GST, the
statutory tax rate for more or less all the goods was concerning 26.5%, Post implication of
GST, mainly goods are in the max range of 18%.
The GST rates for various products have been revised several times by the GST council since
the inception of the Goods and Services Tax (GST).
Additionally, those who are subject to the composition tax are required to pay GST at lesser
or nominal rates, such as 1.5%, 5%, or 6% on their revenue. Under GST, the terms TDS and
TCS also exist, with rates of 2% and 1%, respectively. The GST law also imposes a cess on
the sale of several goods, including cigarettes, tobacco, aerated water, gasoline, and motor
vehicles, in addition to the foregoing GST rates, with rates ranging from 1% to 204%.
There are three main components for GST in India:
 CGST: Collected by the Central Government on sale of goods and services within the
same state
 SGST: Collected by the State Governments on sale of goods and services within the
same state
 IGST: Collected by the Central Government for sale of goods and services between
two states
The abbreviation of CGST and SGST is central goods and service tax and state goods and
service tax. In order to calculate tax, first, we need to identify whether the taxable transaction
is an inter-state i.e., between two states or intra-state i.e., within the state supply of goods or
services. In case of an intrastate transaction that is the location of the supplier and the buyer
of the goods and service must be at the same state. In such kind of transactions, the supplier
or the seller has to collect CGST and SGST from the buyer. The CGST collected from the
buyer will be deposited to the Central Government and the SGST collected from the buyer
will be deposited to the State Government. This tax system is also called an integrated tax
system.
The abbreviation of IGST is Inter-State goods and service tax. The taxable transaction
between two different states is computed under IGST. In other ways, the place of the supplier
and the location of the buyer must be in different states. Also, in cases of export or import of
goods or services or when the supply of goods or services is made to or by an SEZ unit, the
transaction is assumed to be Inter-State. In an Inter-State transaction, a seller has to collect
IGST from the buyer.
Tax Slab in India –
List of items under the 0% GST slab rate
Table 1: List of the goods and services exempted from GST or 0% tax products [60]
[61].
Tax in Goods and services
Percent
0% tax slab Hulled cereal grains like barley, wheat, oat, rye, etc.
products
Bones and horn-cores unworked and waste of these products.

Palmyra jaggery

All types of Salt

Kajal [other than kajal pencil sticks]

Picture books, colouring books or drawing books for children

Human hair – dressed, thinned, bleached or otherwise worked

Sanitary Napkins
0% tax slab The government has exempted healthcare and educational services from taxing
services under the new regime that is GST.

List of items under the 5% GST slab rate

Table 2: It shows the goods and services which are listed under 5% tax [60][61]
Tax in Percent Goods and Services
5% tax slab 1) Edibles like: Spices, Plain chapatti, Oil, Pizza bread, Fish fillets, Khakhra,
products & Tea, Coffee (excluding instant coffee), Baby food, Sugar, Cashew nuts, Indian
Services sweets (Mithai or Mishti), Frozen vegetables, Unbranded namkeen, Pawan
Chakki  or wind-based Atta Chakki

2) Fuel like: Coal, Biogas

3) Fertilisers
4) Life-saving medicines and drugs
5) Accessories for specially-abled individuals like: Walking sticks, Braille
paper, Hearing aids, Braille watches

6) Incense sticks or Agarbatti

7) Footwear and apparels under Rs.1000
8) Handmade items like: Carpets, Gabba/Namda, Braids, Ornaments
9) Natural cork
10) Fly-ash blocks
 11) Numismatic coins
12) Ice and snow
13) Kites
14) Marble rubble

Services
1) Aircraft leasing
2) Crude and petroleum products transport
3) Takeaway food
4) Economy class flight tickets 
5) Newspaper printing
6) Tailoring
7) Transport services via AC cabs and radio taxi
8) Restaurants: Both AC and Non-AC standalone ones
Those with a turnover of Rs.50 lakhs
Those in hotels with a sub-Rs.7500 room tariff

9) Print media advertisement space

10) Tour operator services

List of items under the 12% GST slab rate

Table 3: It shows the goods and services which are listed under 12% tax [60][61]
Tax in Percent Goods and Services
12% Tax Slab Goods
Products and
1) Processed food: Frozen meat, Sausage, Fruit juices, Sauces (except salad
Services
dressing items), Ketchup, Cakes, Pickles, Boiled sugar confectionery

2) Dairy products: Butter, Cheese, Ghee

3) Dry fruits and nuts like almonds
4) Packaged products: Drinking water, Coconut water
5) Cooking utensils: Forks, Spoons, Fish knives, Tongs, Ladles, Cake servers

6) Sewing machines
7) Flint buttons
8) Corrective spectacles and glasses
9) Exercise books and notebooks 
10) Walkie-talkies or two-way radios
11) Handmade matches
12) Fixed speed diesel engines
13) Ornamental framed mirrors
14) Containers: Purses, Pouches, Handbags, Jewellery box
15) Photographs 
16) Diagnostic kits
17) Plastic beads
 18) Man-made yarn

Services
1) Business class flight tickets
2) Movie tickets worth less than Rs.100
3) Hotel stay with daily cost less than Rs.7500 
4) Room tariff above Rs.1000 and below Rs.2500 per day
5) Mining and drilling of natural gas
6) Real estate construction for sale IP rights on a temporary basis
7) Foremen-led chit fund services
8) Railway coaches, wagons, or rolling stock sans refund of ITC
9) Eating and drinking at outlets without a liquor license or AC 
10) Goods Transportation in containers via rail not under the Indian Railways
Now, there might be a lot of products or services you might be opting for quite
frequently, which have not been covered under any of the already-mentioned
GST slab rates. Well, we hope that you will find these items under the next tax
category.

List of items under the 18% GST slab rate

The 18% GST rate covers quite a number of relatively essential items.
Table 4: It shows the goods and services which are listed under 18% tax [60][61]
Tax in Goods and Services
percent
18% Tax 1) Eatables: Mineral water, Pasta, Biscuits, Pastries, Cornflakes, Soups,
Slab Curry paste, Preserved vegetables, Instant food mixes, Food supplements,
Products and Mixed condiments, Flavoured refined sugar, Cocoa butter, Ice cream,
Services Chocolate, Chewing gum
2) Capital goods: Plastic tarpaulin, Salt-glazed stoneware pipes, Jute,
artificial plastic, Aluminium foil, Optical fibre, Winding wires, Coaxial
cables, Ball bearing, Roller bearing, Helmets and helmet parts, Electrical
boards, Diesel engine parts, Parts of pumps, Precast concrete pipes, Tyres
and tyre tubes, Retreaded second-hand rubber tyres, Wheel rims and
axles,Paints

3) Household products: Hair oil, Shampoo, Toothpaste, Detergent, Room

deodorisers, Shaving and after-shave products, Mattress, Furniture
(including those made of bamboo)

4) Perfume
5) Cosmetic preparations
6) Make-up and beauty products
7) Weight-measuring devices
8) Installations: Doors and windows, Sanitaryware, Aluminium frames

9) Electrical and electronic appliances: Refrigerators, Water heaters,

Washing machines, Televisions (up to 32 inches), Computer monitors
(below 17 inches), Camera ,Vacuum cleaners, Hair shavers, Hair curlers,
Hair dryers, Fans, Lights, Pumps, Compressors, Set-top box for TVs,
Discharge lamps, Power banks with Lithium-ion batteries, Printers and
cartridges

10) Containers: Suitcase, Vanity case, Briefcase, Cotton handbags,

Shopping bags, Polythene and Polypropylene packets and bags, Non-
leather school bags

11) Dental wax
12) Kajal pencils
13) Electrical transformer
14) Measuring devices like callipers, tapes, etc.
15) Leather clothing
16) Wrist watches
17) Cooking items: Stoves, Cutlery, Cookers
18) Telescope
19) Razor and razor blades
20) Goggles
21) Binoculars
22) Stationary: Pencil-sharpeners, Clips, Staplers
23) Carriages for specially-abled individuals and babies
24) Sports goods
25) Video game consoles
26) Other products with HSN code 9504

Services
1) Movie tickets worth more than Rs.100
2) Hotel accommodation bill equal to or above Rs.7500
3) Daily room tariff ranging between Rs.2500 and Rs.5000
4) Eating at restaurants located in hotels with above Rs.7500 daily tariff
5) Telecom and IT services
6) Outdoor catering
7) Performance arts: Theatre, Indian classical and folk arts, Circus
8) Party arrangement
9) Eating and drinking at outlets with a liquor license, AC and heating
arrangement.
List of items under the 28% GST slab rate
Table 5: It shows the goods and services which are listed under 28% tax [60][61]
Tax in Percent Goods and Services
28% Tax Goods:
Slab
Without Cess
Products and 1) Eatables: Aerated water (with or without sugar), Instant coffee,
Services Chocolates (without cocoa), Coffee concentrates, Custard powder, Protein
concentrates, Sugar syrups, Molasses 
2) ATM vending machine
3) Air conditioners
4) Dishwashers
5) Yachts
6) Aircrafts
7) State-owned and state-authorised lotteries
8) Accessories: Eyelashes, Wigs, Felt hats, False beards
9) Fax machines
10) TV monitors over 32 inches
11) Stoves (excluding LPG and kerosene ones)
12) Powder
 
With Cess
1) Caffeinated beverages
2) Tobacco and tobacco products
3) Pan masala and Gutkha
4) Fuel: Petrol, LPG, CNG
5) Motorised vehicles (except motorcycles)
Services
1) Hotel stay with over Rs.7500 bill
2) 5-star hotel services
3) Gambling
4) Go-karting
5) Ballet
6) Racing club services
 7) Casinos
 8) Entertainment services,
9) Theme parks, amusement parks, and joy rides
10) Sports events
Now, there are many items that are considered unavoidable necessities. To
help individuals of every economic stratum get access to such products and
services, these items come with 0% GST. Read on to know where such
taxes are applicable.

Expectation, Implementation and Impact in India :

Even though GST has introduced in many countries it was an extremely challenging act for
the Indian economy to take such a big initiative in the country. Goods and service tax boost
up the economic growth of the country by making it happen the free flow of goods and
services in the economy. Elimination of a huge number of indirect taxes such as Service tax,
Excise, VAT, CST, CAD, and, SAD in the country.
 A less significant amount of tax compliance and an easy tax policy compared to the
previous tax structure
 Exclusion or removes the tax on tax.
 Decreased the trouble with the ordinary man i.e. the public will have to pay a smaller
amount of money to purchase the same products that were expensive previous.
 Enlarged demand and utilization of goods.
 Better demand will direct to boost up supply. Hence, this will eventually guide to
raise in the manufacture of goods.
 Be in charge of black money flow as the scheme usually followed by traders will be
put to a compulsory verification.
 Progress to the Indian economy in the extensive run.
The impact of GST on the Indian economy as follows:
 GST will increase to the government revenues by extending the tax support.
 GST will also provide credit for the dues paid by producers in the goods or services
series.
 GST will take away the customs duties relevant to exports.
 GST will take care of this crisis by providing tax credit to the producers.