India’s GST Council just rolled out major reforms that could make everyday life a bit cheaper and easier for millions. Chaired by Union Finance Minister Nirmala Sitharaman, the 56th meeting approved these changes, which kick in on Monday, September 22, 2025. They target key areas like food, housing, cars, farming, healthcare, and education, aiming to simplify taxes and boost the economy.
The big shift? A new two-slab GST structure at 5% and 18%, ditching the old four-rate mess. This should cut red tape for businesses and lower prices for you and me. Luxury items and so-called sin goods—like tobacco, pan masala, fancy cars, yachts, and fizzy drinks—still face a steep 40% rate plus compensation cess, so no changes there for high-end splurges.
Essential goods get the most love in these GST reforms. Think soaps, shampoos, bicycles, and packaged foods—they drop to 5% from 12% or 18%. Household gadgets see relief too: air-conditioners, TVs over 32 inches, and dishwashers now tax at 18%, down from 28%. These tweaks on daily-use items and home appliances should ease your wallet right away.
Housing gets a win as well. Cement’s GST rate falls from 28% to 18%, while materials like granite blocks, marble, and sand-lime bricks shift to 5%. Officials say this will make building homes more affordable and speed up infrastructure projects nationwide, giving a real push to the construction sector.
Car buyers and farmers will cheer the automobile and agriculture updates. Small cars, two-wheelers up to 350cc, and auto parts move to 18% from 28%. Buses, trucks, and three-wheelers join the lower bracket too. For farmers, tractors now hit just 5% instead of 12%, and tools like harvesters, threshers, sprinklers, and drip irrigation gear also land at 5%. Even bio-pesticides and natural menthol get the 5% rate, supporting India’s farming backbone.
Healthcare shines in these GST changes. Over 30 life-saving drugs and diagnostic kits go tax-free at 0%. Other medicines, including Ayurveda and Unani remedies, drop to 5%. Devices such as thermometers, glucometers, and corrective eyeglasses move to the lower slab, making medical care more accessible.
Services see cuts that hit close to home. Hotel stays up to Rs 7,500 a day fall from 12% to 5%, while gyms, salons, barbers, and yoga classes drop from 18% to 5%. This should make wellness and travel cheaper, giving a lift to hospitality and fitness businesses.
Education supplies become even more budget-friendly. Pencils, crayons, sharpeners, erasers, and exercise books now dodge GST entirely. Geometry boxes and other school gear shift from 12% to 5%, helping parents and students without the extra tax bite.
Textiles and handicrafts round out the benefits. The government fixed the inverted duty issue on man-made fibres, dropping yarn and fibres to 5%. Handmade items like statues, paintings, and traditional toys also move to 5%, nurturing India’s craft sectors.
Overall, these GST reforms aim to slash prices, spark demand, back small businesses (MSMEs), and widen the tax net. They promise easier living, stronger manufacturing, steady revenue growth, and better social safety nets, keeping India’s economy humming.
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