Indian Economy News

GST Rate Cut: Strengthening agriculture, tourism, and industry in Uttarakhand

The recent Goods and Services Tax (GST) rate rationalisation in Uttarakhand is expected to provide a significant boost to the state's economy, particularly in agriculture, tourism, crafts, and manufacturing. The GST rate has been reduced from 12% to 5% on key goods such as Pahari Toor Dal, Uttarakhand Red Rice, and Almora Lakhori Mirchi. These changes are expected to make these products more affordable and competitive in organic and health food markets, supporting small and marginal farmers across 13 hill districts. The GST rate on hotel tariffs up to Rs. 7,500 (US$ 85.25) has also been reduced from 12% to 5%, making travel more affordable and benefiting small hotels, restaurants, and homestays in key tourist destinations like Nainital, Mussoorie, Auli, Chopta, Munsyari, Haridwar, and Rishikesh. Additionally, the GST rate on handicrafts such as Aipan art, Ringal craft, and hand-knitted woollen garments has been reduced from 12% to 5%, supporting local artisans and women-led ventures.
The GST rate on vehicles up to 1200cc (petrol) and 1500cc (diesel) has been reduced from 28% to 18%, making vehicles 8-10% cheaper and supporting 50,000 jobs in the automobile sector. The GST rate on medical devices has also been reduced from 12% to 5%, lowering production costs and boosting competitiveness in the healthcare manufacturing ecosystem. These reforms align with Uttarakhand's vision of sustainable growth, fostering livelihoods in the hills while strengthening emerging industrial hubs in the plains. By reducing tax burdens and improving competitiveness, these reforms will strengthen livelihood security, tourism, MSME growth, and green entrepreneurship, advancing Uttarakhand's vision of inclusive, sustainable, and self-reliant development.

Disclaimer: This information has been collected through secondary research and IBEF is not responsible for any errors in the same.