In a landmark move ahead of Diwali, the Government of India has rolled out a Next-Generation GST Reform, slashing tax rates on a wide range of essential and lifestyle goods. Touted as a “Diwali gift for every Indian,” the reform aims to ease the cost of living, uplift farmers, strengthen MSMEs, and build an Aatmanirbhar Bharat.
Prime Minister Narendra Modi, announcing the reform, said:
“The next generation of GST reforms are a gift for every Indian this Diwali. Taxes for the general public will be reduced substantially. Our MSMEs & small entrepreneurs will get huge benefit. Everyday items will become cheaper and this will also give a new boost to the economy.”
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Big Relief on Daily Essentials
From kitchen shelves to personal care, households will feel an immediate impact:
- Hair Oil, Shampoo, Toothpaste, Toilet Soap, Tooth Brushes, Shaving Cream – GST cut from 18% to 5%
- Butter, Ghee, Cheese & Dairy Spreads – 12% to 5%
- Pre-packaged Namkeens, Bhujia & Mixtures – 12% to 5%
- Utensils – 12% to 5%
- Baby Products (Feeding Bottles, Napkins, Clinical Diapers) – 12% to 5%
- Sewing Machines & Parts – 12% to 5%
Boost for Farmers & Agriculture
Agriculture – the backbone of India’s economy – gets a strong push with reduced taxation on key equipment and inputs:
- Tractor Tyres & Parts – 18% to 5%
- Tractors – 12% to 5%
- Bio-Pesticides & Micro-Nutrients – 12% to 5%
- Drip Irrigation & Sprinklers – 12% to 5%
- Machinery for Soil Preparation, Cultivation, Harvesting & Threshing – 12% to 5%
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Relief in Healthcare Sector
Healthcare becomes more affordable with drastic GST reductions:
- Individual Health & Life Insurance – 18% to Nil
- Thermometers – 18% to 5%
- Medical Grade Oxygen – 12% to 5%
- All Diagnostic Kits & Reagents – 12% to 5%
- Glucometers & Test Strips – 12% to 5%
- Corrective Spectacles – 12% to 5%
Automobiles Made Affordable
The automotive industry gets a major festive push:
- Petrol, Hybrid, LPG & CNG Cars (≤1200cc, ≤4000mm) – 28% to 18%
- Diesel Cars – 28% to 18%
- 3-Wheelers – 28% to 18%
- Motorcycles (≤350cc) – 28% to 18%
- Goods Transport Vehicles – 28% to 18%
Affordable Education for All
A big win for students and parents as study essentials move to zero tax slabs:
- Maps, Charts & Globes – 12% to Nil
- Pencils, Sharpeners, Crayons & Pastels – 12% to Nil
- Exercise Books & Notebooks – 12% to Nil
- Erasers – 5% to Nil
Big Savings on Electronics
Common household appliances see a sharp GST slash, making them more affordable for the middle class:
- Air Conditioners – 28% to 18%
- Televisions (above 32″) – 28% to 18%
- Monitors & Projectors – 28% to 18%
- Dishwashers – 28% to 18%
Also Read: GST on Cement Slashed from 28% to 18%
Process Reforms for Businesses
To further support enterprises and MSMEs:
- Automatic GST Registration within 3 working days for eligible applicants
- Provisional Refunds sanctioned through a system-based risk evaluation for:
- Zero-rated supplies
- Supplies with inverted duty structure
Impact of the GST Cuts on Common People
With essentials, healthcare products, and education items now falling into lower or even zero tax brackets, households will directly save more money every month. From groceries to grooming, parents to patients, the cuts are designed to ease everyday living costs. This puts more disposable income in the hands of the common people, boosting consumption during the festive season.
Also Read: How to Download GST Certificate in 2025
Impact on Economy & Industry
For industries, especially MSMEs and farmers, the tax reductions lower production costs and encourage higher investments. Sectors like agriculture, healthcare, education, and automobiles are expected to see a strong demand revival. Analysts believe this next-gen GST reform could be a game-changer, strengthening India’s domestic markets, spurring manufacturing, and pushing the nation closer towards the vision of Aatmanirbhar Bharat.
Conclusion
This Diwali GST bonanza promises to make daily life more affordable for households, empower farmers, reduce healthcare costs, and boost industries from automobiles to electronics. With wide-ranging reforms, the government has attempted to balance ease of living with economic growth, ensuring that every Indian—from common consumers to businesses—feels the festive cheer.
