India intends to reduce consumption taxes by at least 10 percentage points on over 175 products ranging from shampoos and hybrid automobiles to consumer electronics, according to two sources, providing new information about Prime Minister Narendra Modi's huge tax overhaul.
The proposal includes lowering the goods and services tax (GST) on consumer goods such as talcum powder, toothpaste, and shampoo from 18 per cent to 5 per cent, which is expected to boost sales for corporations like Hindustan Unilever and Godrej Industries.
Consumer gadgets such as air conditioners and televisions may see rates cut from 28 per cent to 18 per cent ahead of the Diwali shopping season, which begins in October and sees brands like Samsung, LG, and Sony dominate sales, NDTV reports.
The proposed reduction in small petrol hybrid car taxes from 28 per cent to 18 per cent is a victory for Toyota Motor and Maruti Suzuki, who have lobbied for years to lower taxes on a technology they claim is cleaner than petrol-based automobiles.
The GST council, led by Union Finance Minister Nirmala Sitharaman and comprised of representatives from the country's states, will deliberate on the list of goods and services on which India intends to reduce taxes on September 3–4.
Modi triggered the broad changes to the complex GST regime during his Independence Day speech on August 15, in which he promised to reduce taxes on everyday commodities but did not provide specifics.
