GST 2025 Update: New Rates, What’s Cheaper and Costlier | CareerFocusNow

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GST 2025: Full Update on New Rates, What’s Cheaper and What’s Costlier

Published: September 8, 2025

India has announced a major overhaul of the Goods and Services Tax (GST) effective from 22 September 2025. The GST Council has simplified the tax structure, making essentials more affordable and taxing luxury and sin goods at higher rates. Below is a detailed summary of the changes for consumers and businesses.

Key Highlights of GST 2025

• The previous four-slab structure (5%, 12%, 18%, 28%) has been replaced with 0%, 5%, 18%, and 40%.
• Essentials such as food items and medicines are either zero-rated or moved to lower slabs.
• Luxury items, tobacco, pan masala, and certain beverages are taxed at 40%.
• The changes are effective from 22 September 2025.

GST Slabs & Representative Items

GST Rate	Representative Items
0%	Milk, paneer, roti, paratha, bread, eggs, fruits, vegetables, essential medicines, life & health insurance.
5%	Biscuits, chocolates, noodles, butter, cheese, snacks (namkeen, bhujia), stationery, toiletries, apparel under ₹2,500.
18%	Electronics, appliances, cement, small cars, telecom services, restaurants, gyms, salons, furniture.
40%	Tobacco, pan masala, aerated drinks, luxury cars, yachts, private aircraft.

Sector-wise Impact

• Healthcare: Life-saving medicines and diagnostic kits now have zero or lower GST.
• Agriculture: Fertilizers, pesticides, and tractor parts now attract lower GST (5%).
• Automobiles: Small cars and electric vehicles are taxed at 18% instead of 28%.
• Construction: Cement and building materials now attract 18% GST.
• Luxury & Sin Goods: Cigarettes, gutkha, aerated drinks, and premium vehicles remain in the 40% slab.

What Consumers Should Know

• Expect lower prices on daily essentials and processed foods.
• Check product labels and invoices after 22 September to see the impact of new GST rates.

What Businesses Should Do

• Update ERP systems and billing software to reflect new GST slabs (0%, 5%, 18%, 40%).
• Ensure accurate HSN classification for products to avoid compliance issues.
• Communicate changes in product pricing to customers where necessary.

Note: These updates are based on official GST Council notifications and media reports. Always cross-check with official CBIC notifications before filing returns.

Posted by CareerFocusNow