The 56th GST Council meeting, chaired by Union Finance Minister Nirmala Sitharaman, has ushered in the biggest reform since GST’s launch in 2017. With slabs slashed, exemptions added, and prices of essentials reduced, the Council has given a festive season boost to consumers. The changes kick in from 22 September 2025, the first day of Navratri.
10 Key Takeaways
1. Only two GST slabs now
The old 5%, 12%, 18%, and 28% structure is gone. Now, most items will fall under just 5% or 18%, with a 40% ‘sin slab’ for items like luxury cars and certain beverages.
2. Effective date
New rates apply from 22 September, except for pan masala, gutkha, and cigarettes, which retain old rates for now.
3. Everyday goods get cheaper
Soaps, shampoos, hair oils, bicycles, kitchenware, and toothbrushes—all will move to 5%, lowering household expenses.
4. Zero GST on basics
UHT milk, packaged paneer, and all types of Indian breads (chapati, paratha, parotta, etc.) will now attract no GST.
5. Packaged foods relief
Namkeens, bhujia, pasta, noodles, chocolates, coffee, and ghee are down to 5% from 12–18%.
6. Electronics & automobiles cut
GST on small cars, ACs, TVs, motorcycles (≤350cc) reduced from 28% to 18%. Large cars, however, face a new 40% slab.
7. Agriculture & labour-friendly
Tractors, farm machinery, handicrafts, leather goods, marble, and granite now attract 5% GST, making them more affordable.
8. Healthcare boost
GST scrapped on 33 lifesaving drugs, reduced on medical devices like glucometers and bandages—bringing relief to patients.
9. Non-alcoholic beverages costlier
Energy drinks and similar beverages now taxed at 40%, to prevent misclassification.
10. Insurance exemption
Individual life and health insurance policies (including ULIPs, term plans, and senior citizen health covers) will now carry zero GST, making them more affordable.
The Council has gone for simplification, consumer relief, and festive cheer. Essentials, healthcare, and small cars are cheaper, but luxury cars and energy drinks will pinch more