GST Reform: Due to the ever-increasing inflation in the country, there is a big impact on the budget of the people. The biggest impact on the budget is when people go shopping; in fact, the GST collected by the government while shopping affects the budget of the people. In such a situation, a plan has been made by the government to give relief to the people.
Let us tell you that preparations are in full swing for a big change in GST by the government. On this, PM Narendra Modi announced the new GST system in his speech given from the Red Fort on 15 August. Under this, it has been proposed to keep only two tax slabs – 5% and 18%. After this, in the meeting of the Group of Ministers held in Delhi on 20-21 August, this proposal to remove the 12% and 28% tax slabs has also been approved. Now the government is considering bringing some essential items like clothes and food items into the 5% GST slab. Due to this, the prices of these products are expected to decrease.
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Which things can be affected?
According to media reports, the government is making a list of such things and services that are used more in daily life. It has a plan to reduce GST to 5% on branded sweets, packaged food and drinks, textile products, cement and construction-related items, services like salons and beauty parlors, etc. However, at present, 18% GST is levied on branded sweets and packed food, 5% on clothes below Rs 1000, 12% on above that, 28% on cement, 18% on mid and high range salons. Customers will benefit after the reduction in these things.
Changes can also be made to insurance and vehicles
Apart from this, the government is also considering giving tax exemption on health insurance and term insurance. Also, there is talk of retaining an 18% tax rate on small vehicles (up to 4 meters) and 40% on big vehicles.
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GST Council meeting will be held
According to the report, the 56th meeting of the GST Council is proposed to be held on 3-4 September 2025 under the chairmanship of Finance Minister Nirmala Sitharaman. Before this, a pre-meeting will be held with the officials in Delhi on 2 September. The final decision on the new tax rates can be taken in this meeting. However, according to the Finance Ministry report, these changes may cause a loss of revenue of about Rs 40,000 crore to the government annually. Therefore, the changes will be implemented in a balanced manner.
Benefits can be obtained before the festive season
If media reports are to be believed, after this important decision of the government, it will get strong benefits in the festive season. Actually, this tax cut should be implemented before Dussehra-Diwali. In such a situation, if the decision is taken in September, then its direct benefit will be given to the customers and traders during the festivals.