The Modi government has given a big gift to the public by reducing GST before festivals. This improvement in GST did not happen overnight, but it started before the council’s meeting in Jaisalmer in December last year. Prime Minister Narendra Modi called Finance Minister Nirmala Sitharaman and asked GST to facilitate businesses and reduce the rate, after which work on it progressed rapidly. Nirmala Sitharaman herself has revealed this.

Sitharaman said in an interview to PTI-language, ‘In fact, the work of extensive reforms in GST had already started. Even before the last GST Council meeting held in Jaisalmer, Rajasthan, the Prime Minister called me and said that once you look at GST, make it convenient for businesses and why there is so many confusion at the rates? I think it was before the Jaisalmer meeting held nine months ago. He said, ‘Then during the budget, when we were discussing income tax measures, he (Prime Minister) reminded me that you are working on GST. This was one thing.

Discussion was being held about GST for a long time

Sitharaman said, ‘Second, the Group of Ministers (GOM) had been working for one and a half years and I appreciate each of them that they worked hard to prepare the report and their suggestions came out, but after listening to the Prime Minister, I decided that now it has come that we should review all aspects of GST, not only the rates, not only the number of slabs, not only the number of slabs, but also to see that there is also a small business, but also that there is also a small business How much better it will be for. ‘

The Finance Minister said, ‘We considered all these things. Saw the classification of goods which was causing a lot of confusion… then, naturally noticed at the rate. From February 1, 2025 to about 15 May, we continued to work for its study review etc.

Meeting PM Modi regarding GST: Finance Minister

Sitharaman said, I went to the Prime Minister in the middle of Tamai, informed him and told that we are close to taking steps. This can take the form of a proposal and requested them to give time. After that he said that you see how can it take it to GST Council.

He said, ‘Then I sat with the team and decided that this would be the proposal of the Center, which will be sent to GOM, because GOM is the ministers of the states. I am not there In fact, we wanted it to be clear that we respect all the works done by GOM. But here a proposal is particularly coming from the Center, which is one-third of the partner in the council.

GST Council’s big decisions

The GST Council last week decided to do two slabs instead of four slabs of GST. Now the tax rates will be 5 and 18 percent, while a special rate of 40 percent will be applicable to harmful items like luxury and cigarettes. Except for cigarette, tobacco and other related items, the new tax rates will be effective from September 22. As part of the rates being random, the rates have been reduced on about 400 items, including consumer products like television and air conditioner, in addition to catering and everyday items.

A historic decision was taken at the 56th GST Council meeting, under which 12% and 28% tax slab has been abolished. Now only two slabs – 5% and 18% will remain. On this matter, Finance Minister Nirmala Sitharaman said that this change will bring relief for common families, farmers, businesses and health sector. He called it the GST improvement of the next generation and the gift of Diwali for the country.

Congress leader and Rajya Sabha MP P Chidambaram has reacted to the government’s decision. He welcomed it, but also criticized strictly. He wrote on X (East Twitter) that rationalizing GST and decreasing rates on many things and services has been welcome, but this decision has been taken with a delay of 8 years. This existing form and tax slab should not have been implemented from the beginning. We were constantly warning while in opposition, but our arguments were ignored.

The GST Rationalization and the Reduction in Rates on a range of goods and services are welcome but 8 years too late

The current design of gst and the rates previving until today

We have been crying hoorse for the last 8…

– P. chidambaram (@pchidambaram_in) September 3, 2025

P Chidambaram raised questions
Congress leader and Rajya Sabha MP P Chidambaram questioned why this reform was still done. He speculated the political and economic reasons behind this. He questioned whether this decision has been taken under the pressure of sluggish economic development, increasing domestic debt, decreasing savings, upcoming Bihar elections or American tariffs. All these factors can be forced to force the government.
TMC surrounds the government
The All India Trinamool Congress (TMC) also attacked the central government and called this decision a victory for the public. The TMC said that taxing the insurance premium was cruel and anti -people. Mamta Banerjee opposed this from the beginning. However, this decision proves that the BJP government listens only when it is under pressure. The TMC warned that it will continue to fight against every such anti -people decision between Parliament, Road and the public.

Economic and political impact
Cutting in GST rates will provide relief to consumers and reduce the cost of living. The industry will get a chance to increase sales and production. There will also be pressure on the government that further decisions should be taken in time and transparent manner.

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GST couricil meeting: A two -day meeting of the GST Council has started from Wednesday under the chairmanship of Union Finance Minister Nirmala Sitharaman and big announcements can be made on Thursday. It is believed that this meeting will be an important step towards implementing the GST reform announcement made by Prime Minister Narendra Modi from the ramparts of the Red Fort.

The aim of the government is to provide a big relief package to the general public, middle class, small traders and farmers before Diwali through this meeting. That is why it has been called ahead of schedule.

Possible major decisions of GST meeting

1. Two slabs instead of four slabs

Currently, four tax slabs of 5%, 12%, 18% and 28% are applicable in GST. In the meeting, they are being considered to reduce only two slabs (5% and 18%).

2. Everyday things will be cheaper

Electronic items like TV, washing machine, fridge are currently in 28% GST slab. It is proposed to shift them to 18% slab, which will make these products cheap. There are plans to bring them to 5%, which are currently in 12% slabs like ghee, betel nut, water bottle, salty, medicines and medical equipment.

3. Luxury and harmful items will be expensive

However, while the common consumer will get relief on goods, tax can increase on luxury and harmful products. Premium cars and SUVs currently have 28% GST. It is proposed that they should be brought under the scope of tax of up to 40% under the new reform. If seen in this way, the government wants to give relief to the general public on the one hand, on the other hand, it will try to make revenue balance by increasing tax on luxury conference and harmful products.

On the other hand, the finance ministers of the opposition parties ruled the GST Council met each other before the meeting to be held on Wednesday and demanded compensation from the Central Government to compensate the revenue loss due to the proposed change in the GST rates. Finance ministers of Himachal Pradesh, Jharkhand, Karnataka, Kerala, Punjab, Tamil Nadu, Telangana and West Bengal participated in this meeting.

In this meeting held last week, these states discussed that if the slabs of 12% and 28% are removed and two slabs of only 5% and 18% are kept by simplifying the tax structure, then the income of the state governments could have a big impact. In such a situation, necessary steps need to be taken to protect their revenue.

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GST couricil meeting: The 56th meeting of GST Council will be held on 3 and 4 September in New Delhi. In this, GST reforms with three pillars of the central government will be discussed. GST 2.0 includes a large scale change in tax rates. In addition to the improvement in GST structure and relief to the common man, the council will also think on the 2-rate GST structure proposed by the government.

It is worth noting that under GST reforms, the proposal to include 12 percent and 28 percent slabs in 5 percent and 18 percent slabs has been approved by GOM on Thursday. Now a final decision will be taken in the council meeting on this. The government has also proposed to impose GST at the rate of 40 percent on syncle goods like alcohol, gambling, tobacco.

The general public of the country will get relief

Prime Minister Narendra Modi, while addressing the people of the country on the occasion of Independence Day, promised to reduce GST rates. He had said that by this Diwali, ordinary citizens of the country will get a big benefit. The central government has proposed only two tax rates-5 percent and 18 percent in the revised system of Goods and Services Tax (GST). With this, the tax slab of 12 percent and 28 percent will end.

At present, there are four slabs of 0 percent, 5 percent, 12 percent, 18 percent and 28 percent, which will be reduced to slabs and merit. To promote the country’s employment generation sector, a special slab of less than 5 percent will be kept in GST tax structure. Apart from this, a slab of 40 percent is also proposed, which will include five to seven harmful items.

According to the proposal, 99 percent items included in the 12 percent slab will come in the 5 percent slab. Similarly, 90 percent of the 28 percent slab will join the 18 percent slab included in the slab.

These things will become cheap

It is expected that GST on small cars will be reduced from 28 percent to 18 percent, which will reduce their price. After the approval of the proposal of a two-by-two GST structure by the Ministry of Finance by the GST Council, the prices of common-used items like Namkeen, Bhujia, Snacks, Noodles, Butter, Ghee will become cheaper. Government sources said, “All the necessary daily use items related to food and education consumed by the common man will come under zero or 5 percent GST slab.”

Also read:

Dairy products from medicine to dairy products … 12 and 28% will become cheaper with the end of slabs