New GST Rates & Slabs 2025 Highlights: Indian taxpayers are ready for a major shake-up as the new GST rates kicks-in from today, September 22. GST 2.0 will now have just two main slabs: 5% and 18%. Most goods and services will fall into these categories. Ultra-luxury items will be taxed at 40%, while tobacco and related products will stay in the 28% plus cess bracket.
What PM Modi said on GST reforms
Prime Minister Narendra Modi on Sunday said that the GST reforms will speed up India’s growth story. He called it a big and important step for “Aatmanirbhar Bharat” and added that promoting ‘swadeshi’ products will help in India’s prosperity. “A GST bachat utsav (savings festival) will begin tomorrow (Monday). You will be able to buy things you like, more easily. The poor, middle class, youths, farmers, women, traders and shopkeepers will benefit from this,” the PM had said.
Which goods will come in the highest tax category?
GST has gone up from 12% to 18% on clothes costing more than Rs 2,500, which means premium brand dresses could become a bit pricier. Aerated beverages with added sugar will be taxed at 40%. Motorcycles with engines over 350 cc and private aircraft will also be taxed heavily at 40%. Luxury items like expensive cars and products with a “sin tax” such as tobacco don’t necessarily become more expensive. Earlier, these items had an extra compensation cess along with GST, but that has been removed, so the total tax on them could actually be lower now.
Follow this space for live updates as new GST rates & slabs 2025 rollout:
PM Modi to address nation today: Modi on GST 2.0 reforms
Modi on Friday described the latest GST reforms as more than mere technical tweaks. He called them bold measures designed to enhance the ease of living, ease of doing business and ease of investing in India.
In a post on X, PM wrote, “By lowering rates on everyday foods and packaging, these reforms make groceries more affordable, boost MSMEs, support farmers and enhance India’s global food competitiveness.”
PM Modi to address nation today: ‘Chips or ships, we must make in India’
A day earlier, Prime Minister Modi inaugurated and laid the foundation stone of projects worth Rs 34,200 crore in Gujarat’s Bhavnagar. Highlighting India’s maritime ambitions, Modi described ports as the “backbone of the nation’s rise as a global maritime powerhouse”. He noted that the government had taken a “historic decision” by classifying large ships as infrastructure to strengthen the sector. During the inauguration, the PM said, “Whether chips or ships, we must make them in India.”
PM Modi to address nation today: What is PM Modi expected to speak on today>?
A day before the new GST rates come into effect in India, Prime Minister Narendra Modi will address the nation at 5 pm on Sunday. There are no official details about the subject of Modi’s address but it is expected that he will speak on the upcoming reforms and pitch once again for economic ‘atmanirbharta’.