GST or Goods and Services Tax is something we all pay whenever we buy goods or use services. From groceries to mobile bills, GST directly affects how much we spend. The Government of India has announced a big change in September 2025- the Next-Gen GST Reform. The new GST rate list is set to help the common man by cutting the tax rates and making things simpler and easier for both consumers and businesses.
Overview of Current GST Tax Slabs (2025)
As of now, GST in India has the following major slabs:
- 0% (Exempt): Essential daily needs such as fresh fruits, vegetables, milk, bread, etc.
- 5% GST Slab: Common goods such as packaged food.
- 12% GST Slab: Processed food, fruit juices, frozen meat, butter, ghee, nuts, etc.
- 18% GST Slab: Most services like restaurants, telecom and banking, cosmetics, toiletries, hair oil, toothpaste, and capital goods.
- 28% GST Slab: Electronic goods such as TVs and refrigerators, small cars and bikes, cement, paints, high-end luxury, premium cars and bikes, and sin goods like tobacco.
New GST Tax Slabs (Effective From 22nd September 2025)
Now, with the GST Council giving a green flag to new GST rates, here are the new GST slabs:
- 0% GST: Along with daily essentials, exemption now also includes personal Health and Life Insurance, exercise books & notebooks, and maps & charts.
- 5% GST Slab: Packaged food, footwear, medicines, small household items, and other commonly used products.
- 18% GST Slab: Restaurant services, telecom services, financial services, electronics like TVs, washing machines, laptops and daily-use appliances, motorcycles below 350cc, and cars below 1200cc.
Note: A special 40% GST slab is introduced for luxury and sin goods such as high-end cars and tobacco products.