GST 2.0 Comes Into Effect Today: 375 Items Get Cheaper, Boost for Festive Consumption Expected
GST 2.0 rolls out from September 22, 2025, cutting rates on 375 items including food, FMCG, electronics, and appliances. Check new GST rates, price cuts, and key highlights.
“GST 2.0 rollout: New tax rates make 375 items cheaper, from kitchen staples to electronics, boosting festive season demand.”
The GST regime makeover, entitled GST 2.0, was given its official launch by the Union Finance Minister yesterday, bringing down the tax rates on about 375 items-giving consumers some relief from essential kitchen products to big-ticket electronics just in time for the festive season.
The Council met on 4th September and passed some wide-ranging reforms aimed at simplification of the structure of tax. Under this new system, most goods and services will be taxed at either 5% or 18%, whereas ultra-luxury items will carry a steep 40% tax slab. The only products that continue enjoying the status of high tax and cess are tobacco and allied products at 28% plus cess.
The Prime Minister further referred to the launch as a "GST Savings Festival" and exhorted folks to associate Navratri celebrations with Swadeshi or self-reliance.
Key Highlights Of GST 2.0
- Simplification of Tax Slabs – GST will now operate on a set of two slabs where most goods will be taxed at 5 or 18% and ultra-luxury items would go for 40% and 28% plus cess for tobacco.
- Earlier system still being replaced – Old corporate law of four slabs of 5%, 12%, 18%, and 28% got phased out.
- The cheaper ones – Ghee, paneer, butter, namkeen, ketchup, jam, dry fruits, coffee, and ice creams have become cheaper.
- The electronic appliances are included – Price cuts for flat-screen television, air conditioners, refrigerators, and washing machines are applicable.
- Passing it on – MRP revision has already been done by ITC, HUL, Amul, Nestlé, Dabur, P&G, Emami, and RCPL.
- Examples for price cut- Dabur Real Juice (1L) was at ₹130 and now is at ₹122; Chyawanprakash (900g) was at ₹475 and is now at ₹440; Hajmola (120 tabs) was at ₹70 and is now at ₹65. Maggi (600g) has been cut to ₹116 by Nestlé; Nescafe Gold at ₹755; and Savlon (100 ml) by ITC to ₹374, and Sunfeast Marie Light (956g) to ₹150.
- Consumer-friendly considerations- After the revision came clothes for baby care, shampoo, soaps, razors, and oral care.
Expected boost during festivals The reforms target a surge in consumption in the period preceding Navratri and Diwali.
Swadeshi call of PM Modi-The Prime Minister stated that GST 2.0 was an opportunity for India to come out as self-reliant and called it a "special occasion" to blend enjoyment with national growth.
Future outlook-The government hopes GST 2.0 will accelerate economic growth, attract investments, and ease compliance from the side of businesses.
With the festival season just started, the analysts are of the view that the sweeping tax cuts would help increase demand on both the consumer and industrial fronts.
