NEW DELHI, Sept 22: The Goods and Services Tax (GST) 2.0 has officially come into effect, delivering major relief to households and consumers across the country. With the overhaul of tax slabs to just 5% and 18%, a wide range of goods and services — from food and daily essentials to hotels, cars, and insurance have become significantly cheaper.
Under the new regime, hotel rooms priced up to ₹7,500 will now cost less by as much as ₹525 per night, while several common food items, including chapati, parathas, milk, paneer, khakhra, and pizza bread, are fully exempt from tax. Products like butter, ghee, coffee, dry fruits, cheese, sausages, jams, biscuits, and breakfast cereals now fall under the 5% slab.
The reform also benefits the automobile sector. GST on two-wheelers up to 350cc has been cut from 28% to 18%, improving affordability for rural consumers and gig workers. Small cars, too, now attract only 18% GST, reducing both upfront purchase costs and EMIs for middle-class families.
Fitness and lifestyle services see relief as GST on gyms and fitness centres drops from 18% to 5%, making wellness more accessible. Insurance policies, transport, appliances, and stationery are also set to cost less.
However, sin goods such as tobacco and soft drinks will now be taxed at 40%, ensuring the revenue balance is maintained.
Announcing the rollout on the occasion of Navratri, Prime Minister Narendra Modi called GST 2.0 a “GST Savings Festival” and linked it with the spirit of Swadeshi. “This Navratri is very special let us unite in our collective efforts for a developed and self-reliant India,” he posted on X.
The government said the reforms aim not only to reduce costs for consumers but also to empower the youth with better mobility, employment opportunities, and increased savings, ultimately strengthening India’s economic growth.