Starting tonight, India’s new GST rates will come into effect, bringing reduced prices on essential goods and providing relief to the poor and middle-class households. With rising monthly expenses, the government’s adjustment of GST slabs aims to ease the financial burden, giving citizens a significant festive-season benefit ahead of Dussehra. Prime Minister Narendra Modi announced that the new rates will allow people to access products at lower costs even before Diwali.
Under the revised GST slabs, essential consumer items such as shampoos, soaps, toothpaste, toothbrushes, razors, and baby diapers will become more affordable. Electronics including TVs and computers will also be available at reduced prices. More than 200 goods have seen tax cuts, with GST rates simplified to mainly 5 percent and 18 percent. Household appliances and electronics that were previously taxed at 28 percent have been reduced to 18 percent.
Items like air conditioners, refrigerators, dishwashers, large-screen TVs, and cement are included in the reduced slabs. In the automobile sector, small car models and two-wheelers may see rates drop from 28 percent to 18 percent, while luxury cars remain under higher taxation. Insurance and financial services premiums are largely at 18 percent, but under the new GST 2.0, health insurance, life insurance, family floater policies, anti-cancer medicines, thermometers, and glucometers are now fully exempt. Agricultural tools for farmers have seen a GST reduction from 12 percent to 5 percent, and educational supplies such as notebooks, erasers, pencils, and crayons also move from 12 percent to 5 percent, reducing costs for middle-income families and improving financial security.
However, certain luxury and harmful goods will continue to attract higher taxes. Cigarettes, bidis, gutkha, pan masala, sugary carbonated drinks, flavored beverages, large cars, motorcycles above 350cc, private helicopters, and yachts will carry a 40 percent special tax. Manufacturers who had already announced price reductions will begin selling products at lower GST-inclusive rates from tomorrow. With the implementation of these changes before Dussehra, the government aims to allow low- and middle-income households to enjoy the festival with greater ease and affordability.