Need proactive outreach for easy transition to new GST rates: CBIC chief

The GST Council, in its meeting last week, has approved to make Goods and Services Tax (GST) a two-tier structure of 5 and 18 per cent, with special rate of 40 per cent on tobacco and related products

With the reduced GST rates on 375 items set to be effective from September 22, Central Board of Indirect Taxes and Customs (CBIC) Chief Sanjay Kumar Agarwal has underlined the need for "proactive outreach" by tax officers to handhold trade and industry in navigating the transition smoothly.

He said greater awareness will not only minimise confusion but also enable businesses, particularly small traders and MSMEs, to adapt seamlessly and fully benefit from the reforms.

The GST Council, in its meeting last week, has approved to make Goods and Services Tax (GST) a two-tier structure of 5 and 18 per cent, with a special rate of 40 per cent on tobacco and related products and ultra-luxury items.

The new rates will be effective September 22, barring tobacco and related products, which would continue to be taxed at 28 per cent plus a compensation cess till December 31.

Currently, GST is levied in the slabs of 5, 12, 18 and 28 per cent.

In his weekly newsletter to tax officers, Agarwal said lower tax incidence on common man essentials will reduce household expenses, while affordable inputs for farmers, artisans, and manufacturers will boost production, employment and exports.

These reforms are not just about rate cuts - they represent a paradigm shift towards a fairer and more citizen-centric tax framework, he said.