Overview

• Widespread reclassification moves hundreds of items into the 5% or 18% brackets, with many education supplies made tax‑free and major consumer electronics and cement cut to 18%.
• All individual life and health insurance policies are now GST‑exempt, while several life‑saving medicines and medical devices shift to nil or 5% to reduce out‑of‑pocket costs.
• Small cars (≤1,200cc petrol or ≤1,500cc diesel, ≤4,000mm) and motorcycles up to 350cc move to 18%, larger cars and bikes above 350cc face 40%, and electric vehicles retain a 5% rate.
• Tobacco products remain at 28% plus compensation cess until state compensation loans are repaid, after which they are slated to move to the 40% slab.
• The government estimates a net revenue impact of about Rs 48,000 crore, while markets and industry leaders welcomed the changes and analysts expect a near‑term boost to consumption.