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BIG NEWS: The biggest GST rate cut since launch
This definitely sounds like a Diwali Gift from Nirmala Sitharaman Ji & Narendra Modi Ji :p
The GST Council has approved a big rate overhaul with full support from all states.
Goal: make life cheaper for families and make business easier for MSMEs.
Let’s break it down.
🔹 Everyday home items
Hair oil, soaps, shampoos, toothbrush, toothpaste, bicycles, tableware and kitchenware move to 5%.
🔹Food on your table
UHT milk, chena and paneer go to 0%.
All Indian breads like roti and paratha are at 0%.
Namkeen, bhujia, sauces, pasta, instant noodles, chocolates, coffee, preserved meat, cornflakes, butter and ghee move to 5%.
🔹 Health first
GST on 33 life-saving drugs falls from 12% to 0%.
Three life-saving drugs earlier at 5% also go to 0%.
Many other critical medicines come down to 5%.
Spectacles and vision-correcting goggles drop to 5% from 28%.
🔹 Farmers and rural economy
Tractors and key farm machines for soil work, harvesting and threshing reduce from 12% to 5%.
Twelve bio-pesticides go from 12% to 5%.
Natural menthol goes to 5%.
🔹 Electronics at home
ACs, dishwashers and all TVs (including above 32 inches) will be at 18% instead of 28%.
Monitors, projectors, set-top boxes and reception devices move from 28% to 18%.
🔹 Vehicles on the road
Small diesel cars up to 1500 cc and length up to 4000 mm come down from 28% to 18%.
Three-wheelers and fully-fitted ambulances go to 18%.
Motorcycles up to 350 cc move to 18%.
🔹 Kids and textiles
Non-electronic toys such as tricycles, pedal cars and parts drop from 12% to 5%.
Quilted textile products priced at ₹2,500 or below cut from 12% to 5%.
High-value cotton quilts above ₹2,500 rise from 12% to 18%.
🔹 When do rates change
New GST rates on goods and services take effect from 22 September 2025.
CBIC will also start a new, faster 90% provisional refund system for inverted duty cases using data and risk checks.
This is a big step for households, large & small shops and factories.
If you have a business, look at mapping your products with the new slabs to plan pricing early
Warm regards,
Amit Aggarwal
Chartered Accountant
