Guwahati: The Goods and Services Tax ( GST ) Council on Friday slashed tax on over 200 items, reduced the levy on restaurants to 5 per cent, left only 50 products under the highest 28 per cent slab, and increased the composition limit for small businesses, as it undertook a comprehensive overhaul of the new tax regime.These changes will benefit consumers and businesses alike, as products ranging from perfumes to chocolates to fans become cheaper, and help douse some of the criticism that has dogged the four-month-old tax system. The economy will get a boost from the likely consumption boost and better compliance due to simpler and less-taxing scheme.The GST Council , the apex decision-making body, approved tax cuts on 178 items to 18 per cent from 28 per cent , and on restaurants to 5 per cent but without credit for taxes paid on inputs used, making household items and eating out cheaper.“We have been reviewing the 28 per cent slab in the last three meetings. In last meetings, we had cut it on 30-40 items... It was being felt that optically some items should not be in 28 per cent and then there were some items that were manufactured earlier by the those that enjoyed excise duty exemption,” finance minister Arun Jaitley told reporters after an eight-hour meeting of the GST Council.ET had, on November 1, reported about the deliberations to cut tax rate in the highest slab.The rate cut is prospective and will be applicable from November 15 after the Centre and states issue notifications.Prime Minister Narendra Modi said the recommendations made by the GST Council will further benefit the people and add strength to the tax regime.“These recommendations are in spirit of the continuous feedback we are getting from various stakeholders on GST,” the prime minister tweeted.The ruling National Democratic Alliance has been under pressure from various quarters, including traders, political parties and industry, to simplify and rationalise the GST framework. Chocolates, condensed milk, mayonnaise, curry paste, refined sugar and sugar cubes, pasta, chikki, idli-dosa batter, frozen fish, chewing gum, washing powder, shaving cream, blade, shampoo, deodorant, cosmetics, marble, granite, mattress, toothpaste, fire extinguisher, watches and nutritional drinks should become cheaper with the cut in GST rates.The rate on 13 items will be lowered from 18 per cent to 12 per cent , on 6 items from 18 to 5 per cent , 8 items from 12 to 5 per cent and 6 items from 5 per cent to zero.Only 50 items have been left in the 28 per cent bracket that include products in luxury and sin goods category and some with large revenue implications such as tobacco products, automobile, washing machine and air-conditioners. The slab had 228 items earlier.“In order to benefit small businesses and consumers, the council has decided to keep only limited items in the 28 per cent tax slab,” Jaitley said. The issues of including real estate in GST and incentivising digital transactions were deferred.The council decided to go beyond the recommendations of the fitment committee that had suggested reduction in rates on fewer items, Jaitley said.Friday’s rejig will have a revenue implication of about Rs 20,000 crore, a government official said. West Bengal finance minister Amit Mitra said the move will cost the Centre Rs 60,000 crore and cause a loss of Rs 30,000 crore to states.Traders supplying goods from ecommerce platforms will now not be required to register if their turnover is below Rs 20 lakh, just like their offline peers. The move will ensure a level playing field.Eating out is set to get cheaper with the council deciding to slash GST rate for the sector to 5 per cent without any input tax credit. Restaurants, at present, face three rates depending on the category they are in.Air-conditioned restaurants face 18 per cent tax with input credit while non-air-conditioned ones pay 12 per cent .The group of ministers looking into the taxation for the sector had recommended 12 per cent tax rate with input tax credit. But some states and the Centre were not in favour of allowing input tax credit.“The council had a long discussion on the issue… Everyone agreed that restaurants that got input tax credit have not passed it on to consumers,” Jaitley said. Restaurants inside hotels with room rates above Rs 7,500 per night will face 18 per cent GST with input tax credit and those below this threshold will face 5 per cent without input tax credit.The council also approved a revamp of the composition scheme to give relief to small and medium enterprises.The threshold of the scheme will now be Rs 2 crore, up from Rs 1crore, which was raised at the previous meeting. This will be a cap provided in the law, but the immediate increase would be to Rs 1.5 crore.Tax rate for those availing the composition scheme will now be 1 per cent irrespective of whether they are traders or manufacturers.Composition scheme for restaurants will remain with 5 per cent rate. Nontaxable goods will not be counted towards payment of tax under the scheme. The scheme offers lower compliance and less paperwork.Composition scheme has been opened up for the services sector, but it can be availed of only by those who provide services up to Rs 5 lakh.Companies with turnover up to Rs 1.5 crore have been allowed quarterly filing of returns. The simple form GSTR 3B has been extended till March 31, 2018.