GST 2.0: 99% of Goods In 12% GST Slab Shifted To 5%, Says FM Nirmala Sitharaman | Business News

The GST rationalisation will boost consumption in the country and push investments, says Finance Minister Nirmala Sitharaman.

Finance Minister Nirmala Sitharaman while speaking at Joint Conclave of Trade and Industries Association – ‘Tax Reforms for Rising Bharat’ in Chennai has reiterated that 99 per cent of all the goods which were in 12 per cent GST bracket have now come in 5 per cent GST bracket. Sitharaman said the GST reforms are huge victory for each and every citizen of the country.

The latest set of GST reforms are set to come into force from September 22.

In a historic reform, Finance Minister Nirmala Sitharaman-led the GST Council, has approved a sharp overhaul of the Goods and Services Tax (GST) structure. Effective September 22, the system will be simplified into just two main slabs of 5% and 18%, replacing the current 12% and 28% rates, with a special 40% slab for luxury and sin goods. Billed as a “historic Diwali gift” for citizens and businesses, the reforms aim to lower the cost of living, boost consumption, and spur economic activity.

Household products like hair oil, shampoo, toothpaste, toilet soaps, shaving cream and toothbrushes will now attract just 5% GST instead of 18%. Rates on butter, ghee, cheese, packaged namkeens, dairy spreads and utensils have been cut from 12% to 5%. Feeding bottles, clinical diapers and sewing machines too move into the lowest slab.

Petrol, diesel and CNG cars within specified categories, earlier at 28%, will now face only 18%. The same applies to three-wheelers, motorcycles up to 350cc and commercial vehicles for goods transport.