 "How will GST impact luxury goods? Let's find out")
With the Parliament clearing the way for four crucial GST bills in its April session, India’s landmark tax reform is all set for its rollout on July 1. While it is expected that most goods may become cheaper after the implementation of the Goods and Services Tax, quite a few services and some goods will become more expensive after the tax comes into effect. It is also expected that the Indian economy will see an inflationary effect immediately after the implementation of the GST.
The current taxes are levied on account of central excise duty rates, embedded central excise duty rates, service tax post-clearance embedding, VAT rates or weighted average VAT rates, cascading of VAT over excise duty and tax incidence on account of CST, Octroi, Entry Tax, among others.
Here are some goods that will be expensive after GST:
Here are some goods that will be expensive after GST:
Luxury cars to become cheaper (Prices are ex-showroom for Delhi. Valid till June 30 (revised based on the cut that kicks in from July 1 due to GST))
Audio Systems/Home theatres
Consumers pay 23 to 28 per cent tax on these currently. Some states charge 5 per cent octroi over and above this. Audio systems could become marginally dearer at places that don't charge octroi, like Delhi. For places that do, like Mumbai, prices could fall marginally. Some retailers say they might not pass on the added cost to consumers.
All prices are MRP; prices after GST are estimates.
Televisions
Consumers pay 23 to 28 per cent tax on these currently. Some states charge 5 per cent octroi over and above this. Television sets could become marginally dearer at places that don’t charge octroi, such as Delhi. For places that do, like Mumbai, prices could fall marginally.
All prices are MRP; prices after GST are estimates.
Refrigerators
Consumers pay 23 to 28 per cent tax on these currently. Some states charge 5 per cent octroi over and above this. Refrigerators could become marginally dearer at places that don't charge octroi, like Delhi. For places that do, like Mumbai, prices could fall marginally.
All prices are MRP; prices after GST are estimates
Mobile phones
(Mobile phones are taxed at 13.5 per cent currently. After GST, this will increase to 18 per cent. But if phones/components are made in India, they could be taxed lower. Most luxury phones are made outside India and could look at a price rise of around 3.5 per cent)
All prices are MRP; prices after GST are estimates
Current: Rs 16.59 lakh
After GST: Rs 17.17 lakh
ANTIQUE GOLD COINS
(The tax burden on collectors of antique coins increases from 1 per cent to 5 per cent once GST kicks in)
Courtesy: http://www.farokhtodywalla.com/index.htm
