New GST Rates Live: On GST 2.0 launch eve, Modi pitches for ‘Make in India’ – What gets cheaper from tomorrow? – Economy News

All individual health insurance policies — including family floater plans and senior citizen health covers — are exempt from GST. The exemption also extends to reinsurance of these individual policies.

The exemption covers all types of individual life insurance policies, including term insurance, endowment plans and unit-linked insurance policies (ULIPs). In addition, reinsurance of these individual policies is also exempt from GST.

“Reform is a continuous process. As times change and the country’s needs change, next-generation reforms are equally necessary. These new GST reforms are being implemented, keeping in mind the country’s current needs and future dreams,” PM Modi said.

PM Narendra Modi in his Sunday speech congratulated the nation ahead of the next-generation GST reforms that will kick in from tomorrow. Here are 5 things that you should know about the upcoming reforms:

Simplified structure: The earlier four-slab GST regime of 5%, 12%, 18% and 28% has been streamlined into just two key slabs—5% and 18%—aimed at easing compliance for businesses and improving transparency for consumers.

Introduction of 40% ‘sin’ tax: A special 40% GST will now apply to luxury and harmful products such as alcohol, tobacco, betting and online gaming, ensuring robust revenue generation without affecting essential commodities.

Lower rates on essentials: Everyday household products placed in the 5% bracket are set to become more affordable, providing relief to consumers in categories such as FMCG, food and healthcare.

Mid-range products benefit: Items previously falling under the 12% and 28% slabs will largely move into the 18% category, translating into reduced costs for automobiles, electronics and lifestyle goods.

Broader industry impact: Key sectors including FMCG, automotive and retail have indicated that the rate reductions will be passed on to consumers, a move expected to spur consumption and demand in the festive season.

PM Modi cited income tax exemption on earning up to Rs 12 lakh, GST reforms and said it is ‘double bonanza’ for poor, neo-middle class, middle class.

“I have high expectations from our MSMEs. What we manufacture in India should be world-class,” says PM Modi.

The dream of ‘One nation, one tax’ was fulfilled after the introduction of GST. The upcoming reforms will make things easier for the businesses in India, PM says in his address.

PM Modi in his address said GST reforms will accelerate India’s growth story. “From tomorrow, the festival of Navratri is starting. I extend my best wishes to you. From the first day of Navratri, the country is taking an important step towards Aatmanirbhar Bharat. Tomorrow, on the first day of Navratri, Next-Generation GST reforms will come into effect with sunrise.”

Prime Minister Narendra Modi begins his address to the nation.

– The earlier four-slab GST regime of 5%, 12%, 18% and 28% has been streamlined into just two key slabs—5% and 18%—aimed at easing compliance for businesses and improving transparency for consumers.

– A special 40% GST will now apply to luxury and harmful products such as alcohol, tobacco, betting and online gaming, ensuring robust revenue generation without affecting essential commodities.

– Everyday household products placed in the 5% bracket are set to become more affordable, providing relief to consumers in categories such as FMCG, food and healthcare.

– Items previously falling under the 12% and 28% slabs will largely move into the 18% category, translating into reduced costs for automobiles, electronics and lifestyle goods.

– Key sectors including FMCG, automotive and retail have indicated that the rate reductions will be passed on to consumers, a move expected to spur consumption and demand in the festive season.

Ahead of Prime Minister Narendra Modi’s address to the nation, AAP leader Durgesh Pathak says, “Whenever the PM addresses the nation, every citizen feels scared. At this time, the economy and inflation are at their peak and with folded hands, we will make a humble request: Let us live as we are being made to live.”

– via PTI

– Food items (12% to 5%): Fruit juices, butter, cheese, condensed milk, pasta, packaged coconut water, soya milk drinks, nuts, dates, sausages.

– Medical items (12% to 5%): Medical-grade oxygen, gauze, bandages, diagnostic kits.

– Zero GST rate: Ultra-high temperature milk, chhena/paneer, pizza bread, khakra, plain chapati/roti, erasers.

– Household goods (12% or 18% to 5%): Hair oil, soap bars, shampoos, toothbrushes, toothpaste, bicycles, tableware, kitchenware, other common-use household articles.

These revisions are expected to ease household expenses and bring significant relief to consumers on everyday essentials.

Finance Minister Nirmala Sitharaman had said that the latest reforms are a “Diwali gift” for consumers. Sitharaman said the move will lower costs for the middle class and also make business operations smoother under GST.

“This reform is not just about rationalising rates. It is also about ease of living and structural reforms. We have reduced slabs to just two and addressed issues related to compensation cess,” FM Sitharaman had said.

A day earlier, Prime Minister Modi inaugurated and laid the foundation stone of projects worth Rs 34,200 crore in Gujarat’s Bhavnagar. Highlighting India’s maritime ambitions, Modi described ports as the “backbone of the nation’s rise as a global maritime powerhouse”. He noted that the government had taken a “historic decision” by classifying large ships as infrastructure to strengthen the sector. During the inauguration, the PM said, “Whether chips or ships, we must make them in India.”