This is why the government imposes heavy taxes on ‘Sin Goods’, these products fall in this category..

Many important decisions have been taken in the 56th meeting of the GST Council, which will directly affect our daily expenses. Now the 12% and 18% tax slabs will be abolished and only 5% and 18% will remain. This means that many essential items will become cheaper. But on the other hand, taxes have been increased heavily on certain items. These have been considered Sin Goods. Now, 40% GST will be imposed on them. The purpose of this decision is to reduce the use of these items and increase the income of the government, and invest it in health and social welfare works.

What are Sin Goods?

The term Sin Goods means items that are considered harmful to people's health and society. Such as tobacco products, alcohol, gutkha, pan masala, etc. The government imposes higher taxes on these items so that their use can be reduced. Under the previous rules, a separate cess (Compensation Cess) was levied on them along with 28% GST, which brought the total tax to about 40%. Now, in the new system, a new tax slab of 40% has been created by removing the cess, which has made the tax rate simple and clear.

Which items will come under the 40% GST tax slab?
The items that the GST Council has categorized as Sin Goods will be taxed at 40%. These items are mainly divided into two categories.

Luxury vehicles and transport-
Petrol engine cars with an engine capacity of more than 1200 cc
Diesel engine cars with an engine capacity of more than 1500 cc
Motorcycles with an engine capacity of more than 350 cc
High-end cars meant for passenger transport, such as station wagons and racing cars
Private helicopters and airplanes
Yachts and other luxury boats
Tobacco and related items-
Pan masala, gutkha, bidi, tobacco products
Unprocessed tobacco and tobacco powder (except leaves)
Cigars, cigarette holders, smoking pipes
Beverages-
Aerated drinks with added sugar or sweetener
Caffeinated beverages
Carbonated fruit drinks or fruit-based drinks
Other non-alcoholic beverages
How will the tax changes affect the common man?
Earlier, these Sin Goods were taxed at around 40% due to 28% GST along with a separate cess. The new 40% GST slab will make this tax straightforward and easy. Its purpose is to reduce the consumption of these products and increase government revenue. By increasing tax on items that are considered luxury or harmful to health, the government's message is clear - use them less. This will also take steps towards improving health. New tax rates will be implemented from 22 September, due to which the common consumer will get relief on many everyday items, but items like Sin Goods will become a little expensive.

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