GST 2.0 Comes into Effect from Sept 22: Over 375 Items Get Cheaper Across India
India has rolled out its revamped GST regime today, September 22, 2025, bringing sweeping changes that make over 375 goods and services more affordable. The new tax structure replaces the older four-slab system with two primary GST rates—5% and 18%—alongside a special 40% rate on luxury and sin goods.
Prime Minister Narendra Modi described the reform as a “GST Bachat Utsav” and said it will substantially ease the burden on consumers, especially amid rising festive demand. These measures coincide with the start of Navratri, giving buyers discounts across essentials, electronics, and automobiles.
The newly introduced 40% slab applies to sin goods, luxury items, and certain vehicles. This includes tobacco products, premium and luxury cars beyond specified engine or size thresholds, aerated drinks with sugar, beauty services at premium locations, and high-end imported gadgets.
The reform is expected to relieve many household budgets, especially for middle and lower-income consumers—food, diapers, soaps, electronics, even small cars are more affordable starting today. As the country celebrates the festive season, many are calling this the first major tax relief in recent years.
Prime Minister Narendra Modi described the reform as a “GST Bachat Utsav” and said it will substantially ease the burden on consumers, especially amid rising festive demand. These measures coincide with the start of Navratri, giving buyers discounts across essentials, electronics, and automobiles.
What Gets Cheaper
- Daily essentials & personal care: Items like soaps, shampoos, hair oil, toothpaste, and grooming products move into the 5% tax slab. Price cuts are already visible on products such as talcum powder, face powder, shaving cream, after-shave lotions, toothbrushes and toilet soaps.
- Food & dairy items: Goods including ghee, butter, paneer, namkeen, jam, ketchup, ice-creams, chocolates, biscuits, coffee, dry fruits, and fruit juices have seen GST reduced to 5%, bringing down MRPs. Some staples are now exempted entirely.
- Electronics & home appliances: TVs over 32 inches, ACs, dishwashers, washing machines, and refrigerators have moved from higher slabs (up to 28%) to 18%. TV makers like Sony, LG, Panasonic have dropped prices by up to ₹85,000 depending on size and features.
- Automobiles: Small cars and two-wheelers now face 18% GST, a cut from earlier higher rates. Larger or luxury cars will still carry higher tax or premium sin/luxury slabs.
- Healthcare & medicines: Most medicines, diagnostic kits, glucometers and medical devices are now taxed at 5%, or in some cases are GST-exempt. Several life-saving drugs have also been fully exempted.
What Remains Costlier
The newly introduced 40% slab applies to sin goods, luxury items, and certain vehicles. This includes tobacco products, premium and luxury cars beyond specified engine or size thresholds, aerated drinks with sugar, beauty services at premium locations, and high-end imported gadgets.
What to Know
- Pre-September stock with old MRPs is not required to be re-labelled immediately, giving sellers time to adjust.
- Consumers should check the billed GST rate and MRP at purchase to ensure they benefit from the new rates.
- Businesses and manufacturers nationwide are revising prices and publishing updated lists to reflect the GST changes.
The reform is expected to relieve many household budgets, especially for middle and lower-income consumers—food, diapers, soaps, electronics, even small cars are more affordable starting today. As the country celebrates the festive season, many are calling this the first major tax relief in recent years.