Overview

• The 56th Council session, chaired by Finance Minister Nirmala Sitharaman on September 3–4, will consider compressing slabs to 5% and 18% with a new 40% rate for sin and luxury items.
• Proposals under review include moving more than 150 everyday goods to lower or nil rates, exempting or reducing GST on health and life insurance, and shifting many electronics and smaller cars from 28% to 18%.
• Administrative changes on the table feature pre-filled returns, automated refunds based on risk profiles, and fixes to inverted duty structures in textiles, footwear and electronics to ease compliance and improve cash flows.
• Revenue-loss estimates from the rejig vary widely—from roughly ₹50,000–60,000 crore to as high as ₹85,000 crore–₹2 lakh crore—prompting several states to seek multi‑year compensation; Council decisions require Centre–state consensus or weighted voting.
• Markets and brokerages expect consumption gains if cuts pass, flagging beneficiaries in FMCG, footwear and durables, while the Centre is pushing for a festive‑season rollout subject to Council approval and state buy‑in.