GST Rejig
Govt notifies new GST rates for items post Council decision, effective Monday
This story was originally published at 19:29 IST on 17 September 2025
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NEW DELHI – The government Wednesday notified the rates of Central Goods and Services Tax as decided by the GST Council earlier this month. The new GST rates will come into effect from Monday, the notification said. States will now have to notify the State GST rates.
On Sept. 3, the GST Council overhauled the indirect tax regime by collapsing the four-slab GST structure of 5%, 12%, 18%, and 28% to a two-slab structure of 5% and 18%. The council also introduced a new GST rate of 40%, to be imposed on sin and luxury goods. In a press conference after the GST Council meeting, Finance Minister Nirmala Sitharaman said all new rates, except for those on tobacco products, will take effect from Sept. 22.
"As rate notifications are now being released, it is imperative for industries to align their Enterprise Resource Planning systems, pricing decisions and supply chain. This strategic alignment is critical to ensure a smooth implementation and crucially to guarantee that the benefits of this rate rationalisation are effectively passed on to the end consumer," Saurabh Agarwal, tax partner at EY, said.
With the notification, it is now for the trade and industry to pass on the benefit of these changes to consumers and align compliances in a timely manner, experts said. The finance ministry has already asked its field officers to compile monthly data reports on changes in prices of common-use articles for six months.
"Businesses must promptly update their systems, revise pricing, and ensure smooth implementation of the new rates across supply chains. The success of this reform will depend on how effectively and transparently industry adopts these revised tax rates," Rajat Mohan, senior partner at AMRG & Associates, said. End
Reported by Sagar Sen
Edited by Nishant Maher
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