GST Revamp to Slash Prices: A Boost for Common Man and Economy

The GST Council has overhauled the tax regime, simplifying slabs to 5 and 18 percent, effective September 22. This move will reduce prices on consumer goods, insurance, and more, aiming to stimulate the economy impacted by US tariffs. Tobacco, personal-use goods, and insurance see significant tax cuts.

The Goods and Services Tax (GST) Council has approved a major overhaul of the GST system, with the aim of reducing the tax burden on essential and aspirational goods. Announced by Union Finance Minister Nirmala Sitharaman, the council has simplified the GST structure from four to two main slabs: 5 percent and 18 percent, effective the first day of Navaratri, September 22.

This revamp means consumer essentials, such as hair oil, ice cream, and televisions, will become more affordable, while life and health insurance premiums are now GST-exempt. Previously taxed at 18 percent, this change seeks to expand insurance coverage and relieve financial pressure on families.

The move comes as India's economy seeks to recover from the impact of elevated US tariffs. The GST simplification is expected to boost domestic consumption and support key sectors like agriculture and health, which have been hit hard by global economic challenges. With the potential to positively impact GDP, the GST reform reflects a collaborative effort by states to prioritize the common man's interests.

(With inputs from agencies.)