GST rate changes make some essential goods and services expensive
11 Jan 2022
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Beginning 1 January, some products and services have become expensive due to certain changes made in the Goods and Services Tax (GST) regime and the tax burden is on the consumer.
The hikes were notified by the Central Board of Indirect Taxes and Customs (CBIC) on 18 November 2021.
Accordingly, finished goods such as apparel, footwear and textiles will become costlier due to a hike in GST on such items from 5 per cent to 12 per cent. The same hike has been imposed on apparel costing less than or equal to Rs1,000.
Textiles, including woven fabrics, synthetic yarn, blankets, tents, and accessories such as tablecloths or serviettes, have also become costlier by the rate hike.
Auto rickshaw rides booked through app aggregators like Ola and Uber will get costlier as well. The government will levy a 5 per cent GST on auto rides booked online from 1 January, ending an existing exemption. However, rides availed from the streets will remain GST-free.
Those booking cabs online will have to pay slightly less since the earlier GST rate of 6 per cent will now come down to 5 per cent.
Food delivery apps will have to collect and deposit 5 per cent GST on behalf of restaurants for the deliveries it makes from them. Earlier, the tax was collected from the restaurants. However, there will be no effect on customers since the GST rates are already applicable.
