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Friday 17 January 2020

Today onwards, here’s how your economy has changed

From corporate tax rate cut to GST revisions, from rules for banks to that of credit cards, all changes come into force with effect beginning 1 October

There have been various changes in the rules of various sectors of the economy including banking, driving license, GST from 1 October that is today. These changes are going to have a significant impact on the lives and economies of all of us.

According to the guidelines of the Reserve Bank (RBI), today onwards, banks will give retail loans at a repo rate-linked interest rate. Due to the revision in GST rates, the prices of some commodities will increase wil those of some others will decrease. Some very important changes related to driving license have come into effect from today, too.

Let us know in detail about these changes.

Repo rate-linked interest rate today onwards

Following the RBI guidelines, public sector banks, including SBI, Canara Bank and Corporation Bank, have begun offering retail loans at repo rate-based interest rates beginning 1 October. This will result in a decrease in your monthly EMI due to the reduction in repo rate by RBI.

Earlier, banks did not pass on the full benefit of a reduction in repo rate to the customers. In view of this reluctance of banks, the central bank issued guidelines on 4 September, directing retail and MSME loans to be linked to external benchmarks.

Changes in GST rates: Difference to your consumption beginning today

According to the decisions of the GST Council, the new rates have come into effect from 1 October. Now, GST will not have to be paid on hotel rooms for a daily rent of up to Rs 1,000. Also, the new rate of GST will be 12% on rooms with a rent of Rs 7,500.

The new GST rate on train coaches and wagons is now 12%. In addition, caffeine drinks also will become more expensive. Now GST will be levied on such substances at the rate of 28% and additional cess of 12% have to be paid.

No cashback on payment by credit card at petrol pumps

On filling petrol or diesel at a pump, you will no longer get a cashback of 0.75% if you pay the amount due using a credit card. Banks offering credit cards have sent a message to their customers, informing them that the public sector petrol companies have decided to abolish this exemption from 1 October onwards. However, this exemption on payments by other means will continue.

Drastic reduction in corporate tax: Impact begins today

Finance Minister Nirmala Sitharaman recently announced a huge reduction in corporate taxes, giving relief to domestic companies. The finance minister announced the reduction of corporate tax from roughly 30% to approximately 22%. This deduction will be effective beginning today.

Manufacturing companies formed after 1 October will now have to pay corporate tax at the rate of just 15%. There will be an option to pay a 15% tax.

Rules related to driving licence and RC have changed

Many rules related to driving licence have changed from today onwards. You will have to update your old licence, which you can do online. With the implementation of this rule, driving licence and the vehicle registration certificate (RC, available in the form of a card) will be of the same colour everywhere in the country.

SBI to charge less penalty

The State Bank of India (SBI), the country’s largest bank, has announced a drastic reduction in the amount of penalty for not maintaining the minimum balance stipulated. This reduction will be effective from today onwards.

SBI customers in the metropolitan cities can make 10 and those from non-metro locations can make 12 transactions a month free of charge.

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