<p>New Delhi: The 18 per cent tax slab is expected to remain the major contributor to GST revenues if the Centre's proposal for a two-tier GST structure and a special 40 per cent rate is implemented, according to a source.</p>.<p>At present, the Goods and Services Tax (GST) follows a four-tier structure with rates of 5 per cent, 12, 18, and 28 per cent. Food and essential items are either exempt or taxed at 5 per cent, while luxury and sin goods attract the highest rate of 28 per cent.</p>.<p>The 5 per cent slab contributes around 7 per cent to total GST revenues, while the 18 per cent slab accounts for a dominant 65 per cent. The 12 per cent and 28 per cent slabs contribute approximately 5 per cent and 11 per cent, respectively, to the GST collection.</p>.<p>The Centre has proposed to the Group of Ministers on GST rate rationalisation a 2-tier rate structure of 5 and 18 per cent for 'merit' and 'standard' goods and services, and a 40 per cent rate for about 5-7 goods. The proposal entails doing away with the current 12 and 28 per cent tax slabs.</p>.GST reforms: PM Narendra Modi seeks states' cooperation.<p>"The 18 per cent slab will continue to account for a lion's share in the GST revenues as per the Centre's proposal. We expect volumes to go up and a consumption boost which will help improve the GST revenues from the current level," the source said.</p>.<p>Once the goods and services are categorised as merit and standard, 99 per cent of the items in the 12 per cent bracket will move to 5 per cent, with the remaining moving to 18 per cent.</p>.<p>Also, 90 per cent of the goods and services in the 28 per cent bracket will move to 18 per cent and only 5-7 items will go up to 40 per cent rate.</p>.<p>The average monthly GST collection has risen from Rs 1.51 lakh crore in FY22 to Rs 1.84 lakh crore in FY25.</p>.<p>GST, which subsumed over a dozen local levies and cesses, was rolled out on July 1, 2017. The number of registered taxpayers has risen from 65 lakh in 2017 to over 1.51 crore. </p>
<p>New Delhi: The 18 per cent tax slab is expected to remain the major contributor to GST revenues if the Centre's proposal for a two-tier GST structure and a special 40 per cent rate is implemented, according to a source.</p>.<p>At present, the Goods and Services Tax (GST) follows a four-tier structure with rates of 5 per cent, 12, 18, and 28 per cent. Food and essential items are either exempt or taxed at 5 per cent, while luxury and sin goods attract the highest rate of 28 per cent.</p>.<p>The 5 per cent slab contributes around 7 per cent to total GST revenues, while the 18 per cent slab accounts for a dominant 65 per cent. The 12 per cent and 28 per cent slabs contribute approximately 5 per cent and 11 per cent, respectively, to the GST collection.</p>.<p>The Centre has proposed to the Group of Ministers on GST rate rationalisation a 2-tier rate structure of 5 and 18 per cent for 'merit' and 'standard' goods and services, and a 40 per cent rate for about 5-7 goods. The proposal entails doing away with the current 12 and 28 per cent tax slabs.</p>.GST reforms: PM Narendra Modi seeks states' cooperation.<p>"The 18 per cent slab will continue to account for a lion's share in the GST revenues as per the Centre's proposal. We expect volumes to go up and a consumption boost which will help improve the GST revenues from the current level," the source said.</p>.<p>Once the goods and services are categorised as merit and standard, 99 per cent of the items in the 12 per cent bracket will move to 5 per cent, with the remaining moving to 18 per cent.</p>.<p>Also, 90 per cent of the goods and services in the 28 per cent bracket will move to 18 per cent and only 5-7 items will go up to 40 per cent rate.</p>.<p>The average monthly GST collection has risen from Rs 1.51 lakh crore in FY22 to Rs 1.84 lakh crore in FY25.</p>.<p>GST, which subsumed over a dozen local levies and cesses, was rolled out on July 1, 2017. The number of registered taxpayers has risen from 65 lakh in 2017 to over 1.51 crore. </p>