Based on the recent GST Council meeting, a significant GST reform has been approved, which includes a new two-slab structure and several rate cuts on a wide range of goods and services. The new tax rates are set to be implemented from September 22, 2025.
The key changes involve the removal of the 12% and 28% tax slabs, with most items being shifted to a new 5% or 18% bracket. A new 40% slab has also been introduced for luxury and "sin" goods.
Also read: India delivers GST bonanza for Common Man, new GST rates from 22 September
Here is a summary of the GST rate cuts by category:
Household & Personal Items
From 12% to 5%:
Daily consumables like ghee, nuts, and packaged drinking water.
{{/usCountry}}Daily consumables like ghee, nuts, and packaged drinking water.
{{/usCountry}}Namkeen, bhujia, mixtures, and other packaged snacks.
Certain footwear and apparel priced up to ₹2,500.
Commonly used items such as pencils, bicycles, umbrellas, and hair pins.
Also read: GST cut: Small cars, under-350cc motorcycles get cheaper; what about bigger ones?
From 18% to 5%:
Personal care items, including hair oil, shampoo, toothpaste, and dental floss.
Processed food items like pasta, instant noodles, cocoa butter, and chocolates.
From 28% to 18%:
Consumer electronics such as certain televisions, washing machines, refrigerators, and air conditioning machines.
Cement.
Automobiles
From 28% to 18%:
Small cars (petrol engines up to 1200cc, diesel up to 1500cc, and length not exceeding 4000mm).
Motorcycles up to 350cc.
Ambulances and three-wheeled vehicles.
Healthcare & Education
Also read: New GST rates: Full list of items that have received rate cut
From 12% or 18% to 5% or Nil:
A wide range of essential medicines and medical devices.
More than 30 cancer drugs, which will now have a nil GST rate.
Medical consumables like spectacles, gauze, bandages, and surgical gloves.
Educational services and materials, including books and learning aids.
Farming & Agriculture
From 12% to 5%:
Agricultural equipment used for soil preparation, such as fixed-speed diesel engines.
Fertilizer inputs like sulphuric acid, nitric acid, and ammonia (cut from 18% to 5%).
Tractor tyres and diesel engines for tractors (cut from 18% to 5%).