New Delhi, Nov 7 : The GST Council is likely to consider lowering rates on various goods including on many items of daily use at its next meeting later this week, Finance Minister Arun Jaitley hinted on Tuesday.
He noted that while fixing the Goods and Services Tax slabs initially, the Council had been guided by the principles of equivalence and revenue neutrality but had later lowered the rates on many items over its last few meetings.
"In the old regime, the central excise was embedded in the cost, so people didn't realise and with the cascading effect of excise, VAT, the taxes added up to 31 per cent. Keeping with the equivalence principle, that is how the 28 per cent GST slab was born," Jaitley said at the India Today Conclave Next here.
"The GST Council in the last 3-4 meetings has slashed rates on over 100 items, thereby bringing them down either from 28 per cent to 18 per cent, or from 18 per cent to 12 per cent," he said.
"We have been gradually bringing them down. The whole idea is as your revenue collections neutralise, we must prune it and that's the pattern in which the Council has so far been functioning. I see that as a future guide as far as the Council is concerned," he added.
Officials said here last week that the Council could consider cutting rates on a variety of items like handmade furniture, plastic products and daily use items like shampoo, and simplify return filing rules. It is scheduled to meet on November 10 in Guwahati.
At its previous meeting last month, the Council adopted a concept paper that laid down guidelines for changes in rates.
As per the paper, no manufactured goods should be given outright exemption as this would hinder the 'Make in India' initiative. Besides, states should opt for direct subsidy transfers if they wanted to reduce the tax on any item.
Under the new indirect tax regime, most goods and services have been bracketed in the five, 12, 18 and 28 per cent categories.