GST council likely to address inverted duty structure in notebooks

New Delhi: The GST Council is likely to address the inverted duty structure on notebooks and textbooks in its upcoming meeting, as the issue has been diminishing the benefits of recent tax cuts.

Notebook and textbook prices may remain high, despite them being exempted from Goods and Services Tax (GST), because 18 per cent GST is charged on the paper used to produce them, which manufacturers cannot claim as an input tax credit. This anomaly raises cost and pushes up final prices, sources familiar with the matter said.

An inverted duty structure arises when input materials attract a higher GST rate than the final product. This breaks the credit chain, leading to blocked input tax credits and higher costs for manufacturers and consumers.

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