Prime Minister Narendra Modi announced exciting changes to India’s Goods and Services Tax (GST) system, kicking off from September 22. He called these next-generation GST reforms a “double bonanza” for the poor, the emerging neo-middle class, and the middle class. The updates aim to cut living costs and help millions chase their dreams more easily.
In his address to the nation on Sunday evening, Modi explained that starting tomorrow, the GST will simplify to just two main tax slabs: 5 percent and 18 percent. Everyday essentials like food, medicines, soap, toothpaste, and even insurance will either go tax-free or face only a 5 percent rate. “This means big relief for families on basic needs,” he said.
Modi highlighted how nearly 99 percent of items previously hit with a 12 percent tax now shift to the lower 5 percent bracket. That covers everything from groceries and healthcare to fun stuff like TVs, refrigerators, two-wheelers, cars, and hotel rooms. “These reforms make essential goods and lifestyle items more affordable for everyone,” the Prime Minister noted.
He also pointed to India’s progress over the past 11 years, where 25 crore people have lifted themselves out of poverty and joined a vibrant neo-middle class. Now, with these GST tweaks, the poor, neo-middle class, and middle class get a real boost. “Their goals—from buying a home or a vehicle to traveling more—will feel within reach,” Modi added.
These GST changes build on earlier wins, like the government’s move this year to make income up to Rs 12 lakh tax-free—a direct gift to the middle class. When you add that to the GST relief, the savings add up fast. “Together, these steps will save Indians more than Rs 2.5 lakh crore in one year alone,” Modi said.
Traders and shopkeepers are buzzing with excitement over the reforms, which echo the idea of “Nagrik Devo Bhavo”—treating citizens like gods. Overall, Modi stressed that these tax system updates focus on everyday people, simplifying life and turning big dreams into reality.
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