GST Cuts Start Today – Cars, Food, ACs, and Daily Goods Get Cheaper

GST Reform Cuts Rates to 5% and 18%, Helping Indians Save Rs. 2.5 Lakh Crore on Cars, Food, and Essentials

India’s biggest GST reform since 2017 has started today, September 22. The new system brings only two main slabs, 5% and 18%. Expensive goods like luxury cars and tobacco fall under 40%. This move makes a wide range of goods and services cheaper across the country.

Everyday Goods and Services Become Cheaper

Home and kitchen appliances are among the biggest winners. Air conditioners, washing machines, televisions, and dishwashers now carry a lower tax. Prices drop by thousands of rupees; thus, gadgets have become more affordable for middle-class families.

Everyday essentials also get cheaper. Soap, shampoo, toothpaste, and other personal care items now fall under the 5% slab. Families will also spend less on groceries as dairy products, ghee, paneer, juices, jams, sauces, and namkeen see rate cuts. Basic food items like roti, chapati, and paratha are now completely tax-free.

Relief also comes in health. Many life-saving medicines now carry no tax, while others drop to 5%. Health and life insurance premiums have gotten full exemptions. Medical devices, diagnostic kits, and equipment are also tax-free. Wellness services for good health, gyms, salons, yoga classes, and more also get relief; rates fall from 18% to 5%.

Boost for Cars, Farming, and Travel

The automotive market sees major cuts. Small hatchbacks and popular sedans now attract only 18% GST instead of 28%. This means savings from Rs. 40,000 on entry cars to over Rs. 1 lakh on SUVs. Two-wheelers under 350cc, which cover most scooters and bikes in India, also get cheaper by several thousand rupees.

Construction and farming have received exemption benefits, too. Cement, tractors, harvesters, and fertilizers move to lower tax rates, bringing down costs for builders and farmers. Hotels charging less than Rs. 7,500 per night also become cheaper for travelers.

However, some goods will cost more. Luxury vehicles, high-end motorcycles, soft drinks, and tobacco now fall under a 40% slab. Clothes priced above Rs. 2,500 also attract a higher rate of 18%.

Prime Minister Narendra Modi called this a “savings festival.” He said the reform will help people save more than Rs. 2.5 lakh crore this year. The change aims to make living costs lighter for the poor, the middle class, shopkeepers, farmers, and small businesses.

The government hopes the GST reform will boost spending during the festive season, give relief to households, and support growth in key sectors of the economy.