07/09/2025
Share:
07/09/2025
Share:
NEW DELHI, Sep 7: In a significant move aimed at providing widespread relief to consumers, farmers, and small businesses, the government has announced a major overhaul of the Goods and Services Tax (GST) structure approved by Prime Minister Narendra Modi, as promised on 15th August from Red Fort to ease the tax burden on the middle class & poor. The new rates, dubbed the "Next-Gen GST," represent a substantial reduction on a wide range of essential and everyday products, from groceries and medical supplies to household appliances and construction materials.
Prime Minister of India Shri Narendra Modi
The 56th GST Council meeting, led by Union Finance Minister Smt. Nirmala Sitharaman, unveiled the seven key pillars of Next-Gen GST reforms set to redefine India’s economic landscape. The decisions underscore the ongoing evolution of GST into a more citizen- and business-friendly system, aimed at fostering growth and strengthening the stability of Bharat’s economy.
The sweeping changes are designed to lower the cost of living and boost key sectors of the Indian economy. The reforms are being communicated through a series of public announcements, each highlighting the benefits for different segments of society.
The sweeping changes are designed to lower the cost of living and boost key sectors of the Indian economy. The reforms are being communicated through a series of public announcements, each highlighting the benefits for different segments of society.
Key Reductions Include:
Food and Groceries: The tax on everyday groceries has been significantly reduced, lightening the monthly financial load for families across the country.
Housing: In a move that promises to make homeownership more accessible, the tax on cement has been slashed from a hefty 29% to 18%. This reduction is expected to ease costs for both homeowners and builders, making the dream of building a home more affordable.
Household Goods: A major relief has been provided for common household items. Taxes on products like hair oil, toothpaste, and soap bars have been reduced from 27% to 5%. Furthermore, the tax on LPG stoves has been cut from 21% to 5%, directly reducing expenses for millions of families.
Farmers and Small Businesses: To boost agricultural productivity and support small enterprises, the tax on small diesel engines has been cut from 16% to 5%. Additionally, the tax on tyres and other farming equipment has been reduced from 20% to 5%, lowering operational costs for India's farmers.
Healthcare: In a critical decision aimed at making healthcare more affordable, the tax on medical diagnostic kits and reagents has been reduced from 25% to 5%. This reduction is expected to significantly lower treatment costs for patients.
Consumer Durables: Aspirational products like air conditioners and televisions have seen their tax burden reduced from over 31% to 18. This cut is poised to transform these items from luxury goods into household staples for a larger section of the population.
Indulgences: Even items of common indulgence like chocolates have been made sweeter with a tax reduction from 31% to 5%, making them more affordable for all.
A Widespread Impact
This comprehensive revision of the GST framework is being hailed as a progressive step towards simplifying the tax regime and putting more money back into the pockets of consumers. By reducing the tax burden on essentials and high-impact goods, the government aims to stimulate demand, encourage investment, and provide tangible economic relief to citizens at every level.
The slogan "When Business Stopped Being Weighed Down" encapsulates the initiative's core objective: to unburden individuals and businesses from high costs, fostering an environment of growth and prosperity.
