Prime Minister Narendra Modi lauded the GST Council for reducing the number of GST slabs to two. He said the Union Government prepared detailed proposals for broad-based GST rate rationalisation and process reforms.
The reforms aim to ease living for the common man and strengthen the economy.
In a tweet, PM Modi stated that the GST Council, comprising Union and State governments, agreed to the proposals. He said the reforms will benefit farmers, women, youth, the middle class, and MSMEs.
“The wide-ranging GST reforms will improve citizens’ lives and ensure ease of doing business for all, especially small traders,” PM Modi added.
GST Slabs Rationalised; Popular Items More Affordable
The GST Council, chaired by Finance Minister Nirmala Sitharaman, rationalised the indirect tax structure. It reduced four slabs to two, keeping only 5 per cent and 18 per cent, while removing 12 per cent and 28 per cent. New GST rates on services will apply from 22 September.
The Council cut GST on personal care items, including hair oil, shampoo, toothpaste, and dental floss, from 18 per cent to 5 per cent.
Packaged snacks such as namkeens, bhujia, mixtures, and chabena, earlier taxed at 12 per cent, now attract 5 per cent GST.
The tax on tobacco products, including cigars, cigarettes, and substitutes, rose from 28 per cent to 40 per cent.
Goods containing added sugar, sweeteners, or flavours, including aerated drinks, now attract 40 per cent GST.
PM Modi said the GST reforms will reduce classification disputes, correct inverted duty structures, and ensure rate stability. He added that the reforms will strengthen economic sectors, stimulate activity, and expand businesses, particularly small and medium enterprises.
He emphasised that next-generation GST reforms focus on structural changes, rate rationalisation, and ease of living for all citizens.
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