Centre proposes scrapping of 12% and 28% GST slabs, most items to move to 5%, 18% rates: Government sources
In a path-breaking initiative relating to the Goods and Services Tax structure, the Central Government has proposed to scrap the current slab of 12 per cent and 28 per cent of GST rates and keep only 5 per cent and 18 per cent GST rates, government sources said on Friday.
ANI
Aug 15, 2025 18:02 IST
New Delhi [India], August 15 (ANI): In a path-breaking initiative relating to the Goods and Services Tax structure, the Central Government has proposed to scrap the current slab of 12 per cent and 28 per cent of GST rates and keep only 5 per cent and 18 per cent GST rates, government sources said on Friday.
Government sources said as part of the initiative, 99 per cent of 12 per cent slab are proposed to move in 5 per cent slab and 90 per cent of items in 28 per cent slab are proposed to move in the 18 per cent slab.
They said that consumer goods kept in the 28 per cent slab are proposed to be moved to the 18 per cent slab. They also said that a new slab of 40 per cent is proposed for "sin goods" like tobbacco and pan masala.
The initiative is in line with Prime Minister Narendra Modi's announcement during his Indepedendence Day Speech on Friday that people are going to get a very big gift on Diwali and the government has embarked on "big reform of GST".
The sources said that the proposal by the Centre has been sent to the states. It has also been sent to the Group of Ministers (GoM) of the GST Council.
The sources said that the proposal will be studied by the GoM and a meeting of the GST Council is likely to be held in September-October to consider the proposal.
PM Modi made a major announcement in the Independence Day address relating to GST.
"This Diwali, I am going to make it a double Diwali for you. This Diwali, you fellow countrymen are going to get a very big gift. In the last 8 years, we have done a big reform of GST, reduced the tax burden across the country, simplified the tax regime and after 8 years, the need of the hour is that we should review it once. We started the review by setting up a high-power committee and also held discussions with the states," PM Modi said from the ramparts of the Red Fort.
"We are coming with the next generation of GST reforms, this will be a gift for you this Diwali, taxes needed by the common man will be reduced substantially, a lot of facilities will be increased. Our MSMEs, our small entrepreneurs, will get a huge benefit. Everyday items will become very cheap and that will also give a new boost to the economy," he added. (ANI)
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