Great news for Indian households! The Goods and Services Tax (GST) structure is undergoing a significant simplification and rate reduction, effective from September 22, 2025 (Navratri).
The current four-tier system (5%, 12%, 18%, 28%) will be streamlined into primarily two main slabs:
- 5% GST: For most everyday essentials and common snacks.
- 18% GST: Applicable to standard goods like appliances and small vehicles.
A special 40% slab will continue for luxury and 'sin' goods, including high-end cars, tobacco, and aerated drinks.
Key Changes & Benefits:
- 0% GST: Items such as milk, paneer, roti/paratha, life-saving medicines, and insurance premiums will now be completely tax-free.
- 5% GST: Everyday snacks including namkeen, chocolates, noodles, and butter will now fall under the lowest tax slab.
- 18% GST (Reduced from 28%): Essential household items like ACs, TVs, small cars, bikes under 350cc, cement, and auto parts will see a significant tax reduction.
This major relief is perfectly timed for the upcoming festive season, offering substantial savings for common households.
For more details, refer to the official announcement: Economic Times Article