According to the Indian Express, Piyush Goyal was asked about this: "When asked, Goyal said calculations showed that input tax credit on sanitary napkins was about 3-4 per cent, and the government would ensure a lower price for the end product".
Items on which GST rates were reduced include footwear, small television sets, water heaters, refrigerators, lithium-ion batteries, hair dryers, vacuum cleaners, food appliances and ethanol.
Mr Goyal said, GST rate on handbags, jewellery box, wooden box for paintings, artware of glass, stone endeavour, ornamental framed mirrors and handmade lamps were reduced to 12 per cent. The new rates will kick off from July 26.
Earlier, in the press conference the minister had said that the rates were rationalised on 100 items. Foreign manufacturers, however, would not be subject to input taxes and will also not have to pay any GST, putting them at a massive advantage.
Tax filers with an annual turnover of less than Rs. 5 crore a year need to file returns on a quarterly basis while paying tax on a monthly basis.
The official, however, said that the revenue loss would be only notional as increased consumption and compliance would lead to more revenues to the exchequer.
Mr Goyal said, simplification in tax is a government priority. In its last meeting, the Council had approved the basic principles of GST return design and directed the law committee to finalise the return formats and changes in law.
The council also gave a major relief to the hotel industry by providing that tax rate shall be based on transaction value instead of declared tariff.
It was meant to unify the over US$2 trillion economy into a single market, with four tax rates of 5, 12, 18 and 28 per cent. Those yet to register under GST will be given extension till August 31 without late penalty.
It's ridiculous to remember that Maneka Gandhi was ever of the opinion that 12 percent tax was alright as long as Self-Help Groups (SHGs) were encouraged to make their own biodegradable pads.
These amendments will now be placed before Parliament and the legislature of the state and Union territories for carrying out the amendments in the respective GST acts, the minister said. Around 90 consumer items, many of them popular with urban middle-class voters, will be impacted by the tax cut.