GST Council Proposes Restructuring of Tax Slabs on Essential Items

In its latest meeting, the GST Council has proposed a comprehensive restructuring of current tax slabs. The primary objective of this exercise is to reduce the burden of high taxation on everyday consumer items while simplifying the compliance layout for micro, small, and medium enterprises (MSMEs).

Key Proposals Under Review

• Essential Goods: Proposal to shift several basic kitchen essentials and health products from the 12% bracket to the 5% bracket.
• Luxury Items: Rationalisation of the 28% luxury tax slab to restrict it strictly to sin goods and premium luxury vehicles.
• Filing Thresholds: Recommendation to raise the aggregate turnover threshold for quarterly return filing to benefit regional traders.

Officials noted that these amendments would help stabilize retail inflation while widening the tax base by encouraging compliance. A final decision will be formalized in the upcoming Council session in late June.