The updated GST rates announced by Nirmala Sitharaman, will come into effect from today. Find out all the details in our news story.
Key Highlights of the New GST Structure
The government has reformed the slabs to focus on four major categories:
0% (NIL Rate) on essential food items and insurance premiums.
5% Slab for basic domestic items and services.
18% Slab: Standard Consumer Goods and Services
40% slab: luxury and sin items, such as tobacco, pan masala, and high-end automobiles.
This reform coincides with the festive season and is part of the "GST Savings Festival", which aims to increase middle-class consumption.
What’s Cheaper?
Several products and services have gotten more affordable:
Essential Foods: Roti, paneer, khakhra, and paratha are now in the 0% GST slab.
Appliances: Refrigerators, TVs, washing machines, and air conditioners moved to 5% slab.
Two-wheelers: Entry-level bicycles and scooters are now taxed at 5%.
Insurance: Health and life insurance premiums are now free from GST.
Travel and Hospitality: Budget hotel rooms and domestic travel services would receive decreased GST.
What’s Costlier?
While many items became cheaper, certain categories have become costlier than before:
Apparel: Clothes exceeding ₹2,500 are now taxed at 18% (up from 12%).
Luxury Goods: High-end vehicles, watches, and branded accessories come within the 40% slab.
Sin Goods: Tobacco goods, pan masala, and other sin goods now have the highest GST rate.
Premium Services: Upscale hotels, imported items, and luxury trip packages pay higher taxes.