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New Delhi: The revised Goods and Services Tax (GST) regime came into effect today, cutting rates across a wide range of goods and services. Earlier this month, the GST Council approved a shift from four slabs to two, fixing rates at 5 per cent and 18 per cent, while luxury items will now attract a special 40 per cent levy.
The new rates will make several items cheaper. Daily-use products such as soap, shampoo, detergents, biscuits, coffee, cooking oil, and diapers will see price reductions. FMCG companies including Procter & Gamble (P&G), Hindustan Unilever (HUL), and Emami have announced revised maximum retail prices to pass on the benefits to consumers.
P&G has cut prices of Vicks, Head & Shoulders, Pantene, Pampers, Gillette, Old Spice, and Oral-B products. Diapers will now attract 5 per cent GST instead of 12 per cent, while baby wipes will also be taxed at 5 per cent, down from 18 per cent. Emami has lowered rates on Boroplus cream, Navratna oil, and Zandu balm. HUL has reduced prices of Dove shampoo, Horlicks, Kissan jam, Bru coffee, Lux, and Lifebuoy soaps.
| GST Rates Table (September 2025) | |
|---|---|
| GST Rate | Key Items |
| 0% (NIL) | UHT milk; Chena/paneer (pre-packaged & labelled); Pizza bread; Khakhra, chapathi, roti, paratha, parotta; Specified life-saving drugs & medicines (Agalsidase Beta, Imiglucerase, Daratumumab, etc.); Erasers; Pencil sharpeners; Uncoated paper & paperboard for notebooks; Exercise books, graph/lab notebooks; Maps, atlases, globes. |
| 5% | Condensed milk; Butter, ghee, dairy spreads; Cheese; Dried nuts (almonds, pistachios, hazelnuts, etc.); Dried fruits (dates, figs, guavas, mangoes, citrus, etc.); Malt, starches, inulin; Live horses; Bidi wrapper leaves (tendu); Rubber bands; Talcum powder, shampoos, hair oil, shaving cream/lotion; Toilet soap; Candles; Feeding bottles & nipples; Animal fats/oils; Prepared/preserved meats, sausages, fish, caviar; Refined sugar, glucose, fructose, caramel; Chocolates & confectionery; Corn flakes, pasta, noodles, biscuits, pastries; Preserved vegetables/fruits, jams, juices; Sauces, soups, broths; Ice cream; Namkeens & bhujia (packaged); Packaged drinking water (20L bottles); Plant-based milk, soya drinks, fruit pulp-based drinks; Marble, granite blocks; Medicinal gases & acids; Micronutrients, bio-pesticides; Ayurvedic & allopathic medicines; Diagnostic kits; Surgical gloves, bandages; Wooden furniture, handicrafts, idols; Handmade paper, cartons, bags; Leather goods; Handbags, purses, gloves; Cork, wood articles, bamboo products. |
| 18% | Bidis*; Cement (Portland, slag, aluminous, etc.); Coal, lignite, peat; Non-natural menthol products; Biodiesel (except to OMCs); Odoriferous burning preparations (other than agarbattis); Tyres (other than bicycles/tractors/aircraft); Chemical wood pulp; Writing & printing paper (except exercise books); Kraft & coated paper; Corrugated paperboard; Apparel above ₹2500 per piece; Textile articles above ₹2500; Internal combustion engines & parts; Fuel/lubricant pumps; Air-conditioners; Dishwashing machines. |
| 40% | Pan masala*; Unmanufactured tobacco & refuse*; Cigars, cheroots, cigarettes*; Other manufactured tobacco products*; Tobacco substitutes, extracts & essences*; Sweetened/aerated drinks, caffeinated beverages; Carbonated fruit drinks; Luxury motor cars & SUVs; Motorcycles >350cc; Yachts, aircraft for personal use; Revolvers & pistols; Gambling, betting, casinos, lottery, online money gaming (specified actionable claims). |
Items marked with an asterisk () – new rates will apply from a notified date, subject to settlement of compensation cess dues.*
In healthcare, GST on most medicines, glucometers, and diagnostic kits has been brought down to 5 per cent from 12–18 per cent. The government has directed pharmacies to adjust MRPs accordingly.
Construction is also set to become cheaper, with GST on cement cut to 18 per cent from 28 per cent. Home appliances such as televisions, air conditioners, refrigerators, and washing machines will now fall under the 18 per cent slab instead of 28 per cent.
Automobiles will attract a revised structure: small cars will face 18 per cent GST, while larger vehicles will be taxed at 28 per cent. SUVs and MPVs, which earlier attracted 28 per cent GST plus a 22 per cent cess, will now be taxed at an effective rate of about 40 per cent.
Services including salons, yoga centres, gyms, and spas will see GST reduced from 18 per cent to 5 per cent.
However, certain categories will face higher taxation. A 40 per cent GST rate will now apply to cigarettes, gutkha, pan masala, online gambling services, large cars (over 1200cc and 4 metres in length), motorcycles above 350cc, and soft drinks including flavoured beverages.
Meanwhile, Prime Minister Narendra Modi has termed the new GST reforms as designed to ease the tax burden on households, enhance middle-class savings, benefit the youth, and give fresh momentum to the economy.
"Navratri festivities are commencing. I extend my wishes to all of you. From the first day of Navratri, the country is taking an important step towards a 'Amtanirbhar Bharat' and development. New GST reforms will be implemented since tomorrow's sunrise. GST reforms will bring happiness to every family, will accelerate India's growth story," the PM said in a address to nation on Sunday.
