Middle-class families save more with new GST rates.
By khetivyapar
Posted: 04 Sep, 2025 12:00 AM IST Updated Thu, 04 Sep 2025 07:55 AM IST
The GST Council has announced a significant overhaul in the tax structure, bringing major relief to farmers, households, and consumers. Chaired by Finance Minister Nirmala Sitharaman, the Council decided to scrap the 12% and 28% tax slabs and replace them with a simplified two-tier GST system of 5% and 18%, effective from September 22.
Big Savings on Daily Essentials
Common household products will now be much more affordable:
| Items |
Earlier GST |
New GST |
| Hair oil, shampoo, toothpaste, soap, toothbrush, shaving cream |
18% |
5% |
| Butter, ghee, cheese, dairy products |
12% |
5% |
| Packaged namkeen, bhujia, mixtures |
12% |
5% |
| Baby feeding bottles, napkins, diapers |
12% |
5% |
| Sewing machines and parts |
12% |
5% |
GST reduction on vehicles will ease mobility costs:
| Vehicles |
Earlier GST |
New GST |
| Petrol/diesel hybrid cars (up to 1200CC & 4000mm) |
28% |
18% |
| Diesel/diesel hybrid cars (1500CC – 4000mm) |
28% |
18% |
| Three-wheelers |
28% |
18% |
| Motorcycles (up to 350CC) |
28% |
18% |
| Waste collection vehicles |
28% |
18% |
Healthcare essentials also received major tax cuts:
| Items |
Earlier GST |
New GST |
| Health and life insurance |
18% |
0% |
| Thermometers |
12% |
5% |
| Medical oxygen |
12% |
5% |
| Diagnostic kits |
12% |
5% |
| Glucometers & test strips |
12% |
5% |
| Spectacles |
12% |
5% |
Electronics Now More Affordable:
| Items |
Earlier GST |
New GST |
| Air conditioners |
28% |
18% |
| Televisions (above 32 inches, LED/LCD) |
28% |
18% |
| Monitors and projectors |
28% |
18% |
| Dishwashing machines |
28% |
18% |
Education Becomes Cheaper:
| Items |
Earlier GST |
New GST |
| Maps, charts, and globes |
12% |
0% |
| Pencils, sharpeners, crayons, pastels |
12% |
0% |
| Notebooks |
12% |
0% |
| Erasers |
5% |
0% |
Strict Tax on Luxury and Harmful Goods: While providing relief to the masses, the Council also tightened taxes on harmful products. Pan masala, tobacco, cigarettes, and bidis will now attract a 40% GST slab.
States Welcome the Reform: Finance Minister Nirmala Sitharaman confirmed that the decision was taken unanimously, with full support from state finance ministers. The government aims to make essential goods affordable and support farmers, workers, and ordinary citizens through this reform.
