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2w ago

GST Council Approves Two-Rate Overhaul, Rollout on Sept. 22

Officials peg a Rs 48,000 crore revenue impact, banking on stronger consumption to offset it.

Union Finance Minister Nirmala Sitharaman chairs the GST Council meeting in New Delhi on Wednesday, 3 September.
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The government has reduced the GST rate on appliances, making ACS, TVs and washing machines cheaper for consumers.

Overview

  • India’s four slab structure is collapsed into 5% and 18%, with a new 40% rate for sin and super‑luxury goods such as tobacco, aerated and caffeinated drinks, and higher‑end vehicles.
  • Individual life and health insurance premiums move to nil GST, alongside cuts that shift most 12% items to 5% and most 28% items to 18%, making many essentials, appliances, cement, and most small cars cheaper.
  • The new rates take effect on September 22, while existing GST and compensation‑cess on tobacco and related products continue until compensation‑loan obligations are cleared.
  • Process changes accompany the rate rejig, including faster GST registration, pre‑filled returns, quicker refunds for inverted duty cases, and steps to operationalise the GST Appellate Tribunal by year‑end.
  • Several opposition‑ruled states sought revenue protection even as the Council cleared the package, and officials said the simplified structure is expected to lift demand and compliance over time.