GST reforms: What may get cheaper after Narendra Modi's next-generation Goods and Services Tax in India?
According to these people, the GST reforms will make everyday essentials significantly more affordable — from groceries and medicines to televisions and washing machines. Agricultural equipment, bicycles, and even insurance and education services are set to become cheaper, delivering direct relief to households and farmers while boosting consumption across the economy.
They said there would be just three GST slabs — 5%, 18%, and 40%. Around 99% of the goods falling under the 12% GST slab would fall into the 5% GST slab, while the same number of goods falling under the 28% GST slab would fall under the 18% GST slab.
Items currently taxed at 12% — including condensed milk, dried fruits, frozen vegetables, sausages, pasta, jams, namkeens including bhujiya, tooth powder, feeding bottles, carpets, umbrellas, bicycles, utensils, furniture, pencils, handbags made of jute or cotton, and footwear under ₹ 1,000 — could see rates drop to 5%.
The Central Government has forwarded its proposals to the Group of Ministers examining GST rationalisation. This group will place recommendations before the GST Council, the apex federal body on indirect taxation comprising finance ministers from all states and chaired by Union finance minister Nirmala Sitharaman. The council is empowered to accept the proposal, with or without modification, or reject it.
'We have discussed with states and we are bringing next-generation GST reforms that will reduce the tax burden across the country,' Modi said during his Independence Day speech on Friday, adding, "This Diwali, I am going to make it a double Diwali for you. This Diwali, you fellow countrymen will get a tremendous gift."
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