Archive · 6 Jun 2025
GST Council Considers Removing 12% Tax Slab
The Indian government is thinking about simplifying the Goods and Services Tax (GST).
Right now, there are four different tax rates, but they might get rid of one (12%).
If this happens, items that are currently taxed at 12% might be taxed at either 5% or 18%.
Experts say this will make it easier for businesses, especially small ones, to pay taxes.
GST collections are high, so the government is in a good position to make these changes.
GST Council is considering a move to a 3-tier GST structure.
The proposal aims to eliminate the 12% tax slab.
Experts believe the move would simplify compliance.
The 12% slab currently includes processed foods, household items and more.
Stable GST collections have reduced concerns over revenue loss.
- Who
- GST Council, with input from industry experts
- What
- Considering removing the 12% GST slab.
- When
- Expected soon, likely at the next GST Council meeting.
- Where
- India
- Why
- To simplify GST and ease compliance.
- GST Council Meeting
- Upcoming before monsoon session (July 21)
- Current GST Slabs
- 5%, 12%, 18%, and 28%
- 12% Slab Items
- Packaged foods, household items, diagnostic kits, construction materials
- Expert Support
- Simplification will aid MSMEs, boost compliance.
- Revenue
- GST collections consistently above ₹2 lakh crore
Sources
GST Council may axe 12% slab, shift items to 5% and 18% tax rates
Exclusive | Govt plans to eliminate 12% GST slab in push for 3-tier structure
Will GST Council remove 12% tax slab? List of items under this slab
High GST collections open door for rate rationalisation, say experts
MS Mani: '12% GST rate was intended to be transitional'
