The life of India’s millennials is going to get tougher from July 1. Why so? We are on the verge of a historic tax reform—Finance Minister Arun Jaitley has decided to roll out Goods and Services tax (GST) from July 1. It will replace various taxes levied at present by the central and state governments.
If you are a millennial, you may rejoice because millennials are all for reforms, etc. But the ground reality is that the GST is going to be heavy on your pocket.
Here is a complete guide to how the GST will impact everyday life of a millennial:
Do not worry about the extra burden on your pocket for your regular gymming session or early morning yoga classes as the government also believes health is wealth. Healthcare is exempted from the GST. So is education.
Going to office or college will also become cheaper as the service tax on Ola and Uber or other cab aggregators will be down to 5 per cent from the earlier rate of 6 per cent.
Mobile phones will attract 12 per cent tax. Currently, the duty structure makes imported phones more expensive than locally made ones, but that difference is set to be evened out under GST. However, the government is close to imposing basic customs duty of at least 10 per cent on smartphones, which will make imported devices more expensive than locally made ones. On the whole, the mobile phone prices will only increase.
Mobile bills too will burn a hole in your pocket as the tax will go up to 18 per cent, 3 per cent higher than the existing tax of 15 per cent. So, you have to spend extra Rs 30 if your monthly mobile bill is Rs 1,000. For prepaid customers, effective talk time will be reduced. It will dip to Rs 82 for a 100-rupees recharge in for a 100-rupees recharge instead of 85.
Your Netflix or Hotstar bill may be slightly up in the post-GST regime. Same will be applicable for dongle or WiFi router-LAN connection.
Post college/office hangout at your favourite restaurant or nearest pub will be easy on pocket now. As the government will now charge 18 per cent tax for dining in an AC restaurant theexisting 20 per cent-24 per cent.
What about a weekend show of Wonder Woman in IMAX? Movie tickets costing Rs 100 or more will be taxed at 28 per cent, which is really a lot. For the tickets priced below Rs 100, the tax remains 18 per cent.
Be ready to spend more on apparels. Your quintessential jeans from Zara or T-shirt from Puma priced more than Rs 1,000 will at will attract a 12 per cent levy, higher than the existing 7 per cent. However, GST on beauty products or perfumes is only 1 per cent to 2 per cent more than the previous rate.
Economy-class air travel will be cheaper with the tax rate fixed at 5 per cent against the present 6 per cent. However, business class tickets will be costlier with a 12 per cent tax against the present 9 per cent.
Shopping online may be costlier as the online merchants like Amazon and Flipkart will collect 1 per cent GST from vendors.
Maintaining a credit card has never been easy. Starting from July 1, the GST rate will be 18 per cent, up from the present 15 per cent .