What is the story about?
The 56th GST Council on Wednesday, September 3, raised the Goods and Services Tax (GST) on Coal to 18% from the previous 5%. However, this is not a negative for India's largest miner Coal India Ltd.
Prior to the rate rationalisation, Coal attracted 5% GST and compensation cess of ₹400 per tonne. The GST Council recommended ending the compensation cess and hence, the rate has been merged with the GST. Thus, there would be no additional burden.
Compensation cess is an additional levy under the GST system that is charged on sin goods and luxury items to compensate states for any revenue loss they incurred after the shift to the GST regime in July 2017. The cess will remain in force till October 31.
The GST Council approved reforms to the indirect tax regime, introducing a two-rate structure of 5% and 18% while retaining a special 40% rate for sin goods. The new rates will be in effect from September 22
The move marks the rollout of the Centre's 'GST 2.0' reforms, scrapping the 12% and 28% slabs. This is aimed to simplify compliance and boost consumption. Prime Minister Narendra Modi had promised big bang GST reforms during his Independence Day address on August 15.
Shares of Coal India Ltd. ended the previous session 2.45% up at ₹389.4 apiece. The stock has gained 3.9% in the past month.
(GST Newsbreaks done by CNBC-TV18's Timsy Jaipuria.)
Also Read: GST Council decision - What becomes cheaper and expensive? Check list
Prior to the rate rationalisation, Coal attracted 5% GST and compensation cess of ₹400 per tonne. The GST Council recommended ending the compensation cess and hence, the rate has been merged with the GST. Thus, there would be no additional burden.
Compensation cess is an additional levy under the GST system that is charged on sin goods and luxury items to compensate states for any revenue loss they incurred after the shift to the GST regime in July 2017. The cess will remain in force till October 31.
The GST Council approved reforms to the indirect tax regime, introducing a two-rate structure of 5% and 18% while retaining a special 40% rate for sin goods. The new rates will be in effect from September 22
The move marks the rollout of the Centre's 'GST 2.0' reforms, scrapping the 12% and 28% slabs. This is aimed to simplify compliance and boost consumption. Prime Minister Narendra Modi had promised big bang GST reforms during his Independence Day address on August 15.
Shares of Coal India Ltd. ended the previous session 2.45% up at ₹389.4 apiece. The stock has gained 3.9% in the past month.
(GST Newsbreaks done by CNBC-TV18's Timsy Jaipuria.)
Also Read: GST Council decision - What becomes cheaper and expensive? Check list
Do you find this article useful?
