Minister G Kishan Reddy Calls Coal Tax Cut A Game Changing Industry Reform

• Union Minister G Kishan Reddy praised GST reforms, stating coal tax has been rationalized and Compensation Cess abolished to ease living and business.
• GST rates consolidated into two main slabs: 5 percent for essentials and 18 percent for most goods/services; luxury/sin items retain a 40 percent rate.
• Other ministers highlighted benefits for textiles, middle class, health insurance, and celebrated it as a major economic reform ahead of festivals.

Coal and Mines Union Minister G Kishan Reddy appreciated the Goods and Services Tax (GST) reforms and stated that the tax on coal has been minimized. Addressing media persons, Reddy stated that the tax reforms would be of help to the public. He added, There were four slabs under GST, but now it has come down to two. That has been done with the consideration of ease of living and ease of doing business. The revolutionary reforms will benefit people immensely, and that has also resulted in bringing down the tax on coal.

The GST on coal has been increased from 5 percent to 18 percent. Still, based on information given by the Ministry of Finance, coal earlier had a 5 percent GST, in addition to a Compensation Cess of Rs 400/ton, before the rate rationalisation. The Council has now suggested the abolition of Compensation Cess.

Also, the Union Minister further said that India is poised to become the third-largest economy in the near future. Now, if any rapidly growing economy exists in the world today, it's India. We are progressing towards a developed India. India is a nation with a stable economic status, and in the near days, India will become the third-largest economy, he stated.

Union Textiles Minister Giriraj Singh thanked Prime Minister Narendra Modi for abolishing the inverted duty in the industry and providing a tax concession to the middle class. He says "In the name of the textile industry and all other industries, I thank PM Modi for waiving tax of Rs 50,000 crore to the middle class.PM Modi has kept roti, kapda and makaan (food, clothes and shelter) in two slabs. I congratulate all for this before Diwali and Durga Puja".

The GST Council had made a correction of long-pending inverted duty structure of the manmade textile industry by lowering GST rate on manmade fibre to 5 percent from 18 per cent and manmade yarn to 5percent from 12 percent. In the meantime, BJP leader V Muraleedharan described the GST reforms as an Onam gift to the people of Kerala.

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Muraleedharan said, The new slabs of the GST tax announced by the Finance Minister yesterday is a wonderful Onam gift to the people of Kerala. It has arrived on the eve of the Keralites' greatest festival. It will benefit the poor, middle class, and other sections of society. Zero GST will be levied on health insurance.

In addition, he criticized Kerala Finance Minister KN Balagopal for condemning the move. GST Council has chosen to raise the GST on large corporates. Revenue from tax won't decrease. I don't know why the Kerala Finance Minister didn't protest at the time of the GST Council meeting, but after the meeting, he met the Malayali media and expressed that it would cause trouble for Kerala, he stated.

The 56th GST council meeting decided to rationalize the GST rates to two slabs of 18 percent and 5 per cent by consolidating the 12 percent and 28 percent rates. Union FM Nirmala Sitharaman declared the decision on September 3, as she presided over the GST council meeting. This has cut the earlier GST slabs of 5 per cent, which included necessary goods and services, such as food and kitchen items, agricultural machinery, handicrafts and small industries, and also medical devices and diagnostic kits.

Whereas the 18 per cent bracket has a uniform rate for the majority of goods and services, including vehicles like small cars and motorbikes (less than 350cc), consumer products like electronic devices, household items, and certain professional services.

Besides that, there is a 40 percent slab for luxury and sin items, such as tobacco and pan Masala, items like cigarettes, bidis, and aerated sweet drinks, and luxury cars, high-end bikes over 350cc, yachts, and helicopters. Interestingly, certain important services and education items are completely exempted under GST, such as individual health, family floater, and life insurance.