The 56th meeting of the Goods and Services Tax (GST Council), chaired by Union Finance Minister Nirmala Sitharaman, concluded on Wednesday with major tax relief measures for consumers and businesses.
Sitharaman announced that GST rates have been significantly reduced on items of daily use to ease the burden on the common man and middle-class households.
Key highlights:
- 5% GST: Hair oil, toilet soaps, shampoos, toothbrushes, toothpaste, bicycles, tableware, kitchenware, and household articles (down from higher slabs).
- Nil GST (0%): Ultra-high temperature milk, paneer, chhena, and all Indian breads, including roti and paratha.
- 5% GST (down from 12%/18%): Namkeen, bhujiya, sauces, pasta, instant noodles, chocolates, coffee, preserved meat, cornflakes, butter, and ghee.
- 18% GST (down from 28%): Air-conditioners, TVs (all sizes), dishwashers, small cars, and motorcycles up to 350cc.
In a big health relief, the FM said 33 life-saving drugs, including those used for cancer and rare diseases, will now attract zero GST. Spectacles and vision-correcting goggles have also been cut from 28% to 5%.
The agriculture sector received a boost with GST cuts on tractors, soil preparation and harvesting machinery, composting machines, and 12 specified bio-pesticides — all reduced from 12% to 5%. Handicrafts, natural menthol, marble, granite, and leather goods also saw lower rates. Cement has been slashed from 28% to 18%.
Looking ahead, the Council agreed to streamline GST into a dual-rate structure of 5% and 18%, eliminating the 12% and 28% slabs. Meanwhile, a special 40% GST will apply to sin goods such as tobacco and ultra-luxury items.
Sitharaman said the reforms aim to make GST more consumer-friendly, remove duty inversion in sectors like textiles, and ease compliance for MSMEs.
