8. What is the proposed GST rate?
GST will have a 4-tier tax structure:
- 0% - zero rate, applied to half of the items in the consumer price index(CPI) basket, such as food grains, cereal and other food essentials.
- 5% - lower rate, applied to the rest of the items in the CPI basket plus other items of mass consumption.
- 12% and 18% - standard rates, applied to most goods and services. Items of mass consumption that have previously been taxed between 9% and 15% will now be taxed at a rate of 12% and items that were taxed above 15% will now have a standard tax rate of 18%.
- 28% - higher rate, applied to white goods such as tobacco products, aerated drinks or luxury cars. These goods will also have an additional cess on top of the 28% rate.