GST rate cuts: 375 items to become cheaper from Monday

New Delhi: From automobiles and electronics to food items and medicines, as many as 375 goods and services will become cheaper from Monday, September 22, following the implementation of the new GST framework.

The major rate rationalisation, approved by the GST Council earlier this year, has simplified the tax structure from four slabs to just two — 5% and 18%. A special 40 per cent rate will continue to apply to a select list of luxury and sin goods.

Finance Minister Nirmala Sitharaman described the reform as a “Diwali gift” for consumers, highlighting that it will not only reduce costs for the middle class but also simplify business operations under GST.

“This reform is not just about rationalising rates. It is also about ease of living and structural reforms. We have reduced slabs to just two and addressed issues related to compensation cess,” FM Sitharaman said.

Key Goods and Services Benefiting:

Food Items: Everyday essentials such as milk-based beverages, biscuits, butter, cereals, dry fruits, fruit juices, ghee, ice cream, jam, ketchup, namkeen, paneer, pastry, sausages, and tender coconut water will now attract lower GST.

Daily-Use Products: Shampoos, soaps, hair oil, shaving cream, talcum powder, and face creams will also see price reductions.

Electronics: Air conditioners, washing machines, televisions, and dishwashers will become more affordable.

Medicines and Medical Devices: GST on several medicines and medical devices has been cut to 5%, with the government directing pharma companies to revise MRPs and pass on benefits to consumers.

Services Sector: Salons, barbers, gyms, fitness centres, and yoga services will now attract lower GST.

Housing: For homebuyers, the tax on cement has been slashed from 28% to 18%, which is expected to make housing more affordable.

Companies Passing on Benefits:

• Hindustan Unilever has announced price cuts across popular products such as Dove shampoo, Lifebuoy soaps, Horlicks, and Kissan Jam.
• Amul has reduced prices on over 700 products, including butter, ghee, paneer, cheese, ice creams, and bakery items.
• Indian Railways has lowered the price of Rail Neer bottled water, with a 1-litre bottle now priced at Rs 14, down from Rs 15.

Automobiles Sector:

The automobile sector is among the biggest beneficiaries. Small hatchbacks will now attract 18% GST instead of 28%, with no compensation cess. Companies such as Maruti Suzuki India, Tata Motors, and Hyundai India have announced major price reductions on popular hatchbacks, ranging from Rs 70,000 to over Rs 1.3 lakh, effective September 22.

With IANS inputs