GST on small electric cars, electric SUVs and luxury electric cars to remain at 5%.(Source: Canva)
6 months ago
Sep 04, 2025
The GST Council has announced that the tax slabs have now been cut to two. Essentials such as milk, paneer, butter and life-saving medicines have been granted steep GST cuts or exemptions, while tobacco products, aerated drinks, luxury cars and yachts will attract higher taxes of up to 40%.
Thats all for today folks. Before you go off to bed, here are the key highlights from the GST Council meet.
The GST council has also approved a two-tier rate structure of 5% and 18%, replacing the existing four major slabs — 5%, 12%, 18%, and 28%.
Essentials such as milk, paneer, butter and life-saving medicines have been granted steep GST cuts or exemptions, while tobacco products, aerated drinks, luxury cars and yachts will attract higher taxes of up to 40%.
The changes will take effect from Sept. 22, with phased implementation for certain items.
GST on cement reduced to 18%.
GST on small electric cars, electric SUVs and luxury electric cars to remain at 5%.
The finance minister announced that the compensation cess will now apply solely to tobacco and related products. It will be charged in addition to the 28% GST rate until the pending loan is fully repaid.
She added that the cess will be withdrawn once repayment is completed.
GST Council Meeting Live: Reduced GST On Cement To Accelerate Infrastructure Pipeline
"The Government’s decision to reduce GST on Cement from 28% to 18% is a transformative reform — one that will accelerate the nation’s infrastructure pipeline, catalyse industrial expansion, and strengthen India’s march towards a multi-trillion-dollar economy," said Vinod Bahety, CEO - Adani Cement.
GST Council Meeting Live: Cut In GST To Reduce Prices, Make Essential Goods More Affordable For Consumers
"The decision to bring almost all FMCG products under the 5 percent GST slab is commendable. This rationalization will directly reduce prices, make essential goods more affordable for consumers, and drive higher consumption, thereby benefiting every household in India," said All India Consumer Products Distributors Federation.
GST Council Meeting Live: Post-Sale Discounts To Reduce Large Dispute
“The grant of export status to intermediary services would bring to rest litigations on what qualifies as intermediary and accordingly reduce refund denials on this account. Similarly, the changes on post-sale discounts would reduce a large dispute on their allowability,” said Abhishek Jain, Indirect Tax Head & Partner, KPMG.
GST Council Meeting Live: FM Sitharaman's Office Releases List Of Reforms
"These reforms have a multi-sectoral and multi-thematic focus, aimed at ensuring ease of living for all citizens and ease of doing business for all," said FM Sitharaman's office in a post on X.
Hon’ble Prime Minister Shri @narendramodi announced the Next-Generation GST Reforms in his Independence Day address from the ramparts of Red Fort.
Working on the same principle, the GST Council has approved significant reforms today.
GST Council Meeting Live: Reforms To Benefit Common Man, Says PM Modi
"Glad to state that the GST Council, comprising the Union and the States, has collectively agreed to the proposals submitted by the Union Government on GST rate cuts & reforms, which will benefit the common man, farmers, MSMEs, middle-class, women and youth," said PM Modi in a post on X.
During my Independence Day Speech, I had spoken about our intention to bring the Next-Generation reforms in GST.
The Union Government had prepared a detailed proposal for broad-based GST rate rationalisation and process reforms, aimed at ease of living for the common man and…
GST Council Meeting Live: Marble, Granite, Leather Down To 5%
The GST Council has reduced GST rate from 12% to 5% on natural menthol, handicrafts, and products from labor-intensive sectors such as marble and granite blocks and intermediate leather goods.
GST Council Meeting Live: 'Aspirational Items' Now More Within Reach
The GST rate is set to be slashed from 28% to 18% on a range of aspirational items. This includes ACs, all large-screen TVs/TVs over 32 inches, and dishwashers. The proposal also extends to small cars and bikes with an engine capacity of less than 350cc.
GST Council Meeting Live: Reforms Carried Out With Focus On Common Man
Reforms have been carried out with focus on common man, said Finance Minister Nirmala Sitharaman. She further added that every tax levied on daily use have gone through rigorous review and in most cases, rates have come down.
GST Council Meeting Live: Tax Slabs Reduced To Two
The tax slabs have now been cut to two. "This reform is not just on rationalising rates, it's also on ease of living and structural reform," the Finance Minister said during the briefing.
GST Council Meeting Live: New Tax Rates To Apply From Sept 22
At the high-stake meeting of the GST Council on Wednesday, a consensus was reached on all proposals, including the restructuring of tax slabs from four at present to only two — 5% and 18%, NDTV Profit has learnt.
The new tax rates will come into effect from Sept. 22, the persons privy to the development said.
