{"id":345724,"date":"2025-09-04T18:03:23","date_gmt":"2025-09-04T12:33:23","guid":{"rendered":"https:\/\/forumias.com\/blog\/?p=345724"},"modified":"2025-09-04T18:03:23","modified_gmt":"2025-09-04T12:33:23","slug":"goods-and-services-tax-gst-2-0","status":"publish","type":"post","link":"https:\/\/forumias.com\/blog\/goods-and-services-tax-gst-2-0\/","title":{"rendered":"Goods and Services Tax (GST) 2.0"},"content":{"rendered":"<p><strong>News<\/strong><strong>: <\/strong>The 56th GST Council has recommended changes in GST tax rates on goods and services, from 22 September 2025.<\/p>\n<h2>About Goods and Services Tax (GST) 2.0<\/h2>\n<figure id=\"attachment_345725\" aria-describedby=\"caption-attachment-345725\" style=\"width: 367px\" class=\"wp-caption aligncenter\"><img data-recalc-dims=\"1\" loading=\"lazy\" decoding=\"async\" class=\" wp-image-345725\" src=\"https:\/\/i0.wp.com\/forumias.com\/blog\/wp-content\/uploads\/2025\/09\/Source-BS.jpg?resize=367%2C198&#038;ssl=1\" alt=\"\" width=\"367\" height=\"198\" srcset=\"https:\/\/i0.wp.com\/forumias.com\/blog\/wp-content\/uploads\/2025\/09\/Source-BS.jpg?resize=300%2C162&amp;ssl=1 300w, https:\/\/i0.wp.com\/forumias.com\/blog\/wp-content\/uploads\/2025\/09\/Source-BS.jpg?resize=1024%2C552&amp;ssl=1 1024w, https:\/\/i0.wp.com\/forumias.com\/blog\/wp-content\/uploads\/2025\/09\/Source-BS.jpg?resize=768%2C414&amp;ssl=1 768w, https:\/\/i0.wp.com\/forumias.com\/blog\/wp-content\/uploads\/2025\/09\/Source-BS.jpg?w=1203&amp;ssl=1 1203w\" sizes=\"auto, (max-width: 367px) 100vw, 367px\" \/><figcaption id=\"caption-attachment-345725\" class=\"wp-caption-text\">Source &#8211; BS<\/figcaption><\/figure>\n<ul>\n<li><strong>Goods and Services Tax <\/strong>is a comprehensive, multi-stage, <strong>destination-based indirect tax<\/strong> on goods and services.<\/li>\n<li><strong>Purpose:<\/strong> Its primary purpose is to achieve <strong>\u201cOne Nation, One Tax\u201d<\/strong> by reducing cascading taxes, simplifying compliance, and expanding the tax base.<\/li>\n<li><strong>Launch:<\/strong> It was introduced on <strong>1 July 2017<\/strong> through the <strong>101st Constitutional Amendment Act, 2016.<\/strong><\/li>\n<li><strong>Earlier structure<\/strong>\n<ul>\n<li><strong>Five slabs<\/strong> existed at 0, 5, 12, 18 and 28 percent <strong>with cess<\/strong> on luxury and sin goods.<\/li>\n<li><strong>Exemptions:<\/strong> Essential items such as <strong>food grains, medicines and education<\/strong> were exempt, while <strong>petroleum, alcohol and electricity<\/strong> remained <strong>outside GST<\/strong>.<\/li>\n<\/ul>\n<\/li>\n<\/ul>\n<h2>New GST Rate Structure<\/h2>\n<ul>\n<li><strong>Simplification:<\/strong> Slabs are reduced to <strong>two main rates<\/strong> <strong>plus a special rate.<\/strong><\/li>\n<li><strong>Main slabs:<\/strong> <strong>5 % and 18 %<\/strong> apply on <strong>most<\/strong> goods and services.<\/li>\n<li><strong>Special 40 <\/strong><strong>% rate:<\/strong> Applies to <strong>sin goods<\/strong> and select <strong>super-luxury items<\/strong>.<\/li>\n<li><strong>Key reductions \u2013 A <\/strong><strong>brief<\/strong><\/li>\n<li><strong>Daily-use items<\/strong> like soap, shampoo, toothpaste, bicycles, and kitchenware <strong>move to 5 percent<\/strong>.<\/li>\n<li><strong>Agricultural goods:<\/strong> Reduction of GST from <strong>12% to 5%<\/strong> on agricultural goods, such as tractors, agricultural, horticultural or forestry machinery for soil preparation or cultivation etc.<\/li>\n<li><strong>Cement<\/strong> reduces from <strong>28 percent<\/strong> to <strong>18 percent<\/strong>.<\/li>\n<li><strong>Small cars<\/strong>, <strong>motorcycles under 350cc<\/strong>, <strong>air conditioners<\/strong>, <strong>televisions<\/strong>, and <strong>dishwashers<\/strong> shift to <strong>18 percent<\/strong>.\n<ul>\n<li><strong>Uniform rate of 18% on all auto parts<\/strong> irrespective of their HS code; <strong>Three-Wheelers from 28% to 18%.<\/strong><\/li>\n<\/ul>\n<\/li>\n<li>Staples such as <strong>milk, paneer, rotis, chapatis, and parathas<\/strong> are at <strong>0 percent<\/strong>.<\/li>\n<li>33 <strong>Life-saving drugs<\/strong> and <strong>spectacles<\/strong> are corrected to <strong>0\u20135 percent<\/strong>.<\/li>\n<li>To fix inverted duty, <strong>man-made fibre, yarn, fertilizers, acids, and ammonia<\/strong> reduce to <strong>5 percent<\/strong>.<\/li>\n<li><strong>Pan masala, gutkha, cigarettes, chewing tobacco, unmanufactured tobacco and bidi<\/strong> continue at existing GST slabs.<\/li>\n<li><strong>Revenue impact:<\/strong> The estimated loss is <strong>\u20b948,000 crore,<\/strong> expected to be <strong>offset by higher compliance and buoyancy.<\/strong><\/li>\n<li><strong>Implementation timeline and exceptions<\/strong>: Rate changes for <strong>all goods except specified tobacco and bidi categories<\/strong> take effect from <strong>22 September 2025<\/strong>.<\/li>\n<\/ul>\n<h2>About GST Council<\/h2>\n<ul>\n<li>GST Council is an apex member committee to <strong>modify, reconcile or to procure any law or regulation based on the context of goods and services tax<\/strong> in India.<\/li>\n<li>It is created under <strong>Article 279A.<\/strong><\/li>\n<li>The GST council is the <strong>key decision-making body<\/strong> that will take all important decisions regarding the GST.<\/li>\n<li>The GST Council <strong>dictates tax rate, tax exemption, the due date of forms, tax laws, and tax deadlines<\/strong>, keeping in mind special rates and provisions for some states.<\/li>\n<li><strong>Head: <\/strong>The council is headed by the<strong> Union Finance Minister<\/strong>, who is assisted by <strong>finance ministers of all the states of India. <\/strong><\/li>\n<\/ul>\n","protected":false},"excerpt":{"rendered":"<p>News: The 56th GST Council has recommended changes in GST tax rates on goods and services, from 22 September 2025. About Goods and Services Tax (GST) 2.0 Goods and Services Tax is a comprehensive, multi-stage, destination-based indirect tax on goods and services. Purpose: Its primary purpose is to achieve \u201cOne Nation, One Tax\u201d by reducing&hellip; <a class=\"more-link\" href=\"https:\/\/forumias.com\/blog\/goods-and-services-tax-gst-2-0\/\">Continue reading <span class=\"screen-reader-text\">Goods and Services Tax (GST) 2.0<\/span><\/a><\/p>\n","protected":false},"author":10393,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"jetpack_post_was_ever_published":false,"footnotes":""},"categories":[1566,3127,12039],"tags":[11872],"class_list":["post-345724","post","type-post","status-publish","format-standard","hentry","category-daily-factly-articles","category-economy","category-knolls","tag-9pm-daily-factly","entry"],"jetpack_featured_media_url":"","views":"","jetpack_sharing_enabled":true,"_links":{"self":[{"href":"https:\/\/forumias.com\/blog\/wp-json\/wp\/v2\/posts\/345724","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/forumias.com\/blog\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/forumias.com\/blog\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/forumias.com\/blog\/wp-json\/wp\/v2\/users\/10393"}],"replies":[{"embeddable":true,"href":"https:\/\/forumias.com\/blog\/wp-json\/wp\/v2\/comments?post=345724"}],"version-history":[{"count":0,"href":"https:\/\/forumias.com\/blog\/wp-json\/wp\/v2\/posts\/345724\/revisions"}],"wp:attachment":[{"href":"https:\/\/forumias.com\/blog\/wp-json\/wp\/v2\/media?parent=345724"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/forumias.com\/blog\/wp-json\/wp\/v2\/categories?post=345724"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/forumias.com\/blog\/wp-json\/wp\/v2\/tags?post=345724"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}