GST 2.0: Only Two Slabs 5% & 18%; Relief for Common Man, Luxury & Tobacco Get Costlier

New Delhi (The Uttam Hindu): Now GST will have only two slabs — 5% and 18% instead of four. With this, common essentials like soap and shampoo, as well as ACs and cars, will become cheaper. This decision was taken in the 56th GST Council meeting. Finance Minister Nirmala Sitharaman announced this on September 3. She said that items like milk, bread, paratha, paneer, and several food products will be exempt from GST. Personal health and life insurance will also no longer be taxed. 33 life-saving medicines, drugs for rare diseases, and critical illnesses will be completely tax-free.

GST 2.0… Now only two slabs, 5% and 18%, effective from September 22; see what gets cheaper and costlier:

Luxury goods and tobacco products will now attract 40% GST instead of 28%. Medium and large cars, and motorcycles above 350cc will fall under this slab. The Finance Minister said the new rates will take effect from September 22, the first day of Navratri. However, the new 40% GST rate on tobacco products will not be implemented immediately.

The purpose of these changes is to give relief to the common man, support small businesses, and discourage the use of harmful products like tobacco by raising taxes. At the same time, tax has been increased on luxury vehicles, tobacco products, caffeinated drinks, and even cricket match tickets.

Here’s the full list of what gets cheaper and costlier under the new GST reforms:

Food Products

Vanaspati oils: 12% → 5%

Waxes, vegetable wax: 18% → 5%

Meat, fish, food products: 12% → 5%

Dairy (butter, ghee, cheese, condensed milk): 12% → 5%

Soy milk: 12% → 5%

Sugar, boiled sweets: 12–18% → 5%

Chocolate, cocoa powder: 18% → 5%

Pasta, cornflakes, noodles, biscuits, malt extract (non-cocoa): 12–18% → 5%

Jam, jelly, marmalade, dried fruits, nut pastes: 12% → 5%

Fruit juices, coconut water: 12% → 5%

Packed pizza bread, khakhra, chapati, roti: 5% → 0

Consumer & Domestic Goods

Hair oil, shampoo, toothpaste, shaving products, talcum powder: 18% → 5%

Toilet soap (bar/cake): 18% → 5%

Toothbrush, dental floss: 18% → 5%

Shaving cream, aftershave, lotion: 18% → 5%

Tableware/kitchenware (wood, iron, copper, aluminum, plastic): 12% → 5%

Feeding bottles/nipples, plastic beads: 12% → 5%

Erasers: 5% → 0

Candles: 12% → 5%

Umbrellas: 12% → 5%

Sewing needles, machines & parts: 12% → 5%

Cotton/jute handbags: 12% → 5%

Baby napkins/diapers: 12% → 5%

Bamboo, cane, rattan furniture: 12% → 5%

Milk cans (iron/steel/aluminum): 12% → 5%

Pencils, sharpeners, chalk: 12% → 0

Maps, globes, charts: 12% → 0

Practice books, notebooks: 12% → 0

Electronics

Air conditioners (ACs): 28% → 18%

Dishwashers: 28% → 18%

TVs (LED/LCD), monitors, projectors: 28% → 18%

Agriculture & Fertilizers

Tractors (except >1800cc road tractors): 12% → 5%

Tractor tires/tubes: 18% → 5%

Soil/crop/harvest machinery: 12% → 5%

Compost machines: 12% → 5%

Sprinklers, drip irrigation, lawn/sports rollers: 12% → 5%

Bio-pesticides, micronutrients: 12% → 5%

Fuel pumps: 28% → 18%

Hydraulic pumps for tractors: 18% → 5%

Health & Medicines

Health & term insurance: 18% → 0

Thermometers, diagnostic kits: 12–18% → 5%

Glucometers: 12% → 5%

Medical-grade oxygen, hydrogen peroxide: 12% → 5%

Eyeglasses: 12% → 5%

Surgical rubber gloves: 12% → 5%

Many drugs & special medicines: 12% → 5% or 0

Select rare medicines: 5–12% → 0

Vehicles

Tires: 28% → 18%

Motor vehicles (small cars, three-wheelers, ambulances, <350cc bikes, commercial vehicles): 28% → 18%

Motorcycles >350cc: 28% → 40%

Large SUVs, luxury/premium cars, higher-end hybrids, racing cars: 28% → 40%

Rowing boats, canoes: 28% → 18%

Bicycles & non-motor tricycles: 12% → 5%

Tobacco & Beverages

Cigars, cigarettes, tobacco products: 28% → 40%

Beedi (handmade traditional): 28% → 18%

Carbonated/fizzy drinks, flavored/caffeinated beverages: 28% → 40%

Plant-based milk, fruit pulp-based drinks: 18–12% → 5%

Textiles

Synthetic yarn, non-woven fabric, sewing thread, staple fiber: 12–18% → 5%

Ready-made garments up to ₹2,500: 12% → 5%

Ready-made garments above ₹2,500: 12% → 18%

Paper & Stationery

Paper for exercise books, graph books, lab notebooks: 12% → 0

Graphic paper: 12% → 18%

Paper sacks/bags, biodegradable bags: 18% → 5%

Handicrafts & Art

Carved art products (wood, stone, base metal, cork): 12% → 5%

Handmade paper & paperboard: 12% → 5%

Handicraft lamps: 12% → 5%

Paintings, sculptures, pastels, antiques: 12% → 5%

Leather

Processed leather: 12% → 5%

Leather goods, gloves: 12% → 5%

Building Materials

Tiles, bricks, stone works: 12% → 5%

Portland, slag, hydraulic cement: 28% → 18%

Renewable Energy

Solar cookers/water heaters, biogas/wind/waste-to-energy, solar panels: 12% → 5%

Fuel cell vehicles: 12% → 5%

Coal, lignite, peat: 5% → 18%

Service Sector

Job work, umbrella making, printing, bricks, pharma, hides/leather (with ITC): 12% → 5% (with ITC)

Hotel accommodation <₹7,500/day: 12% → 5%

Cinema tickets <₹100: 12% → 5%

Beauty services: 18% → 5% (no ITC)

Casino/race club entry, betting/gambling: 28% → 40%

Cricket match tickets (domestic & international): 12% → 18%