Council raises GST on low-cost footwear, garments to 12%

In its first physical meeting in two years, the GST Council on Friday effected several long-pending tweaks in tax rates including an increase in the GST levied on footwear costing less than ?1,000 as well as readymade garments and fabrics to 12% from 5%.

The new rates on these products, a decision on which had been deferred by the Council over the past year owing to the pandemic' s impact on households, will come into effect from January 1, Finance Minister Nirmala Sitharaman said.

The Council approved a special composition scheme for brick kilns with a turnover threshold of ?20 lakh, from April 1, 2022. Bricks would attract GST at the rate of 6% without input tax credits under the scheme, or 12% with input credits.

While this will please States like Uttar Pradesh that had sought a special scheme for brick kilns, a decision on extending such a scheme for other evasion-prone sectors like pan masala, gutkha and sand mining was put off.