- Proposed Increase in GST Rate: The Indian government plans to raise the Goods and Services Tax (GST) rate on cigarettes, tobacco products, and certain beverages from 28% to 35%, aiming to generate more revenue and discourage consumption of harmful products.
- Impact on Prices and Companies: If implemented, the proposal will force companies to increase the prices of affected products, leading to a potential decline in earnings for tobacco manufacturers and a need for companies to adjust their marketing strategies. This has already resulted in a decline of up to 3% in the shares of major companies like ITC, VST Industries, and Godfrey Phillips.
- Revised GST Structure: The government is also adjusting GST rates for various items, maintaining lower rates for commonly used consumer goods while increasing taxes on luxury items and harmful products. For example, luxury goods like cars and washing machines may also see higher taxes, whereas garments will have a tiered GST rate based on price.
Source: timesbull.com
Note that this post was (partially) written with the help of AI. It is always useful to review the original source material, and where needed to obtain (local) advice from a specialist.
