20052017-TTC-01.qxd 5/20/2017 1:36 AM Page 1 13 established in 1881 saturday, may 20, 2017 late city chandigarh | gurgaon | jalandhar | bathinda | jammu | srinagar | www.tribuneindia.com | vol. 137 no. 138 | 44 pages | ~5.00 | regd. no. chd/0006/2015-2017 /thetribunechd /thetribunechd Insurance, phone bills to go up GST: From July 1, pay more for banking, biz air travel; education, healthcare spared Tribune News Service & PTI TAX ON SERVICES Srinagar, May 19 Telephone bills, insurance and banking services, business-class air travel and sale of newspaper space for advertisements will become costlier in the upcoming GST regime but education and healthcare will continue to be exempt from tax. The GST Council at its 14th meeting today finalised four tax rates of 5, 12, 18 and 28 per cent for services, including telecom, insurance, hotels and restaurants, under the new regime set to kick in from July 1. The rates are in line with those finalised for goods on Thursday. With this, rates of all items except a handful, including gold and precious metals, footwear and branded items, have been decided ahead of the July 1 rollout of the GST regime. The rates of the remaining goods would be decided at the next meeting in New Delhi on June 3. “There was long debate in which states had some concerns, and finally the GST in relation to the service sector was completely adopted in today’s meeting,” said Finance Minister Arun Jaitley. Jaitley said telecom and financial services, which include banking and insurance, would be taxed at a standard rate of 18 per cent. The tax on telecom services EXEMPT Hotels and lodges with tariff under ~1,000 5% Transport services (railway, air travel); Ola, Uber cabs; restaurants with ~50 lakh or below turnover ‘WON’T LEAD TO INFLATION’ ❝ We made sure that consumers don’t have to pay more. The net effect of goods and services is not going to be inflationary because once the system of input credits starts, the actual incidence is going to be positively impacted. Arun Jaitley, FINANCE MINISTER BIG COMPANIES WARNED ❝ Big companies, please don’t change rates before GST rollout. Let’s try to pass down actual tax rate to consumers and let’s not try to increase tariff only because of tax rate going up. Hasmukh Adhia, REVENUE SECRETARY such as phone bill payment is 15 per cent at present. Also, the current service tax on insurance sector is about 15 per cent, including cess. Revenue Secretary Hasmukh Adhia, however, insisted the tax incidence on telecom services would be unchanged at 15 per cent after the input credit is taken on equipment. Transport services would be taxed at 5 per cent leading to a small drop in the economy class air travel which currently attracts 6 per cent service tax. Non-AC train travel, including on local trains and metro, as well as religious travel, including Haj yatra, will remain exempted from GST. Five per cent rate will also apply on rides from cab aggregators such as Ola and Uber, which currently pay 6 per cent tax. AC train travel will attract 5 12% Non-AC hotels; business class air ticket; fertilisers; work contracts such as whitewash 18% Insurance; telecom/IT services; AC hotels serving liquor; financial services 28% Five-star hotels, cinema, gambling and betting at race course per cent service tax, same as freight levy. Space selling for advertisement in newspapers will attract 5 per cent levy under the GST. It is exempted from tax currently. While the economy class air travel will attract 5 per cent GST, the business class will be charged at 12 per cent. Non-AC restaurants will charge 12 per cent GST on food bill. The tax rate for AC restaurants and those with liquor licence will be 18 per cent, while 5-star hotels will charge 28 per cent GST. Restaurants with Rs 50 lakh or below turnover will go under the 5 per cent composition, he said. Work contracts such as whitewash will be liable for a 12 per cent GST. Entertainment tax will be merged with service tax under the GST and a composite 28 per cent levy charged on cinema services as well as gambling and betting at race course. While the rate proposed for cinema halls is lower than 40 to 55 per cent currently, it may not result in a reduction in tariffs on cinema tickets as states continue to hold right to levy local charges on them. Hotels and lodges charging per day tariff of Rs 1,000 will be exempt from the GST. The rates for hotels with tariff of Rs 1,000 to Rs 2,000 per day would be 12 per cent, while those with Rs 2,500 to Rs 5,000 would be 18 per cent. The GST for hotels with tariff above Rs 5,000 will be 28 per cent. GST on services was the main item discussed at the GST meet today, he said, adding most service tax exemptions will be grandfathered and will continue. Net effect of GST will not be inflationary, he said, adding that healthcare and education services will continue to be exempted from tax under GST. continued on page 9 edit: gst side-effects Pak moves ICJ to rehear Jadhav case Islamabad, May19 Facing bitter criticism from the Opposition, the Nawaz Sharif government in Pakistan today filed a plea in the ICJ for it to rehear within six weeks the case of alleged Indian spy Kulbhushan Jadhav. Pakistan’s Foreign Affairs Adviser Sartaj Aziz said Islamabad, with a new team of lawyers, would put forward its case vigorously. “Pakistan is set to re-challenge the jurisdiction of the ICJ after it granted injunction on an Indian plea to stay Jadhav’s execution,” Dunya News reported. According to law, Jadhav can challenge till Saturday his death sentence in an appellate court. A military court had sentenced him to death on April 10 on spying and terrorism charges. Aziz said the ICJ did not High bidding, sand prices set to soar Ruchika M Khanna Tribune News Service Chandigarh, May 19 In Punjab, building a house will get a lot more expensive. For, the Punjab Government today made over Rs 200 crore from the auction of 51 sand and gravel quarries across six districts. With the bidding prices hitting the roof, the prices of sand and gravel are bound to rise manifold. The reverse bidding (where the lowest bidder is successful) in 2014-15 had yielded Rs 45 crore. The progressive bidding of the 51 quarries today (51 more will be auctioned on Saturday) is expected to yield Rs 350 crore (including today's bids). With the sites going at such high rates, the bidders would have to sell the extracted minor minerals (sand and gravel) at higher rates to cut even. PUNJAB AUCTIONS 51 QUARRIES ■ Already the prices of sand and gravel have shot up since the Cong govt put the brakes on illegal mining ■ The price of sand has increased from ~14,000 per 800 cubic ft (in March) to ~19,000 per 800 cubic ft ■ The price of gravel has zoomed from ~15,000 per 800 cubic ft to ~20,000 per 800 cubic ft The sand mining business in Punjab is cartelised. The auction today saw a rather lukewarm participation from the two main sand mining cartels, continued on page 9 order Pakistan to provide consular access to Jadhav, but had merely put forward an opinion. The Pakistan Government is under attack by the Opposition for “mishandling” the Jadhav case. Two Opposition leaders link the “weak” defence put up by Pakistan to a meeting Sharif had with Indian business tycoon Sajjan Jindal recently. — IANS situation untenable: basitp22 Coal scam: Former Secy convicted New Delhi, May19 A special court here today convicted ex-Coal Secretary HC Gupta in a coal scam case. Special CBI Judge Bharat Parashar also convicted then Joint Secretary KS Kropha and then Director KC Samaria in the case pertaining to “irregularities” in the allocation of Thesgora-B Rudrapuri coal block in Madhya Pradesh to KSSPL. The court will pronounce the quantum of sentence on May 22. The court, however, acquitted chartered accountant Amit Goyal in the case. Others convicted included the firm KSSPL and its managing director Pawan Kumar Ahluwalia. The CBI had alleged that the application filed by KSSPL for the coal block was incomplete and was supposed to be rejected by the ministry. — PTI edit: miscarriage of justice Today’s issue consists of 44 pages, including four-page The Tribune Trends, 12-page Chandigarh Tribune and six-page Life+Style.
The Tribune, now published from Chandigarh, started publication on February 2, 1881, in Lahore (now in Pakistan). It was started by Sardar Dyal Singh Majithia, a public-spirited philanthropist, and is run by a trust comprising four eminent persons as trustees.
The Tribune, the largest selling daily in North India, publishes news and views without any bias or prejudice of any kind. Restraint and moderation, rather than agitational language and partisanship, are the hallmarks of the paper. It is an independent newspaper in the real sense of the term.
The English edition apart, the 133-year-old Tribune has two sister publications, Punjabi Tribune (in Punjabi) and Dainik Tribune (in Hindi).