Overview

• The new regime replaces four slabs with 5% and 18% for most goods and services and a 40% band for luxury and sin items, taking effect on September 22.
• Hundreds of reclassifications lower rates on FMCG, appliances, cement and vehicles, with small cars and two-wheelers moving from 28% to 18% and tractors to 5%.
• Around 375 goods and several services are cheaper, including hotel stays up to ₹7,500 at 5%, while select life‑saving drugs and school supplies are exempt or at 5%.
• Companies have begun passing on cuts, with Amul and Mother Dairy reducing prices on items such as butter, UHT milk, paneer and other dairy products.
• Prime Minister Narendra Modi calls the rollout a “double bonanza” alongside earlier income‑tax relief, citing potential savings of about ₹2.5 lakh crore, as fuel stays outside GST and tobacco retains a high levy with cess.