Finance Minister Nirmala Sitharaman announced a major GST overhaul. She revealed that 99% of goods previously in the 12% bracket are now reduced to 5%. This move aims to stimulate economic activity and benefit consumers nationwide. The announcement was made at a conclave in Chennai titled Tax Reforms for Rising Bharat.
The GST rationalization was approved unanimously by the GST Council on September 3. All states gave their consent, showcasing collective agreement. These reforms are set to bring massive change across India. They will directly impact the lives of 1.4 billion citizens.
The new rates will take effect on September 22. This date coincides with the first day of Navratri. It is much before Diwali, as indicated by the Prime Minister from the Red Fort. The timing is strategic to maximize festive demand.
Sitharaman emphasized the broad benefits of these GST reforms. The event saw attendance from key leaders and business representatives. Tamil Nadu BJP State President Nainar Nagendran and trade association heads were present. Their presence highlighted the importance of these changes.
Two publications were released at the event. They were titled GST 2.0 – Fuelling India Growth and GST Reforms for Tamil Nadu Growth. These documents outline the vision and impact of the tax changes. They serve as a guide for businesses and traders.
The Finance Minister explained specific benefits for Tamil Nadu. Some goods saw tax reduced from 18% to 5%. Others moved from 12% to 5%, and some even dropped to 0%. These adjustments aim to lower the cost of essential commodities.
GST touches every citizen from morning to night. It affects daily essentials and common goods. This reduction will ease the financial burden on households. It is designed to boost consumption and improve livelihoods.
Sitharaman highlighted the growth in GST registrations. In 2017, there were 65 lakh registrations. Today, that number has grown to 1.51 crore. This increase counters criticisms calling it a Gabbar Singh Tax.
Over 350 items have seen GST rates reduced. The list includes groceries, packaged foods, and household goods. Even handicrafts like Thanjavur dolls are now more affordable. This wide coverage ensures broad-based benefits.
Refund issues for small businesses have been addressed. 90% of refunds are now processed quickly. Only 10% are withheld for verification. This improvement supports cash flow and operational ease for entrepreneurs.
GST reforms are about more than just rate cuts. They build trust and boost demand. They propel India toward its 2047 vision. Reforms will continue in agriculture, MSMEs, and essential services.
IIT Madras Director Kamakoti praised GST exemptions on research funding. He stated it supports vital R&D in higher education. He highlighted tax cuts on educational and healthcare items. These benefit middle- and lower-income families significantly.
Reducing GST on consumer goods boosts consumption. Items like TVs, washing machines, and small cars are now cheaper. This stimulates logistics, production, and job creation. India’s digital GST infrastructure handles millions of transactions flawlessly.
Federation of Tamil Nadu Traders Association President Vikramraja welcomed the grocery GST reduction. He urged addressing harassment from tax officials. He also called for implementing the promised trader welfare board. Consistent dialogue has brought these positive reforms.
Tamil Nadu BJP President Nainar Nagendran praised PM Modi and Sitharaman. He called her a pride for Tamils in Delhi. India’s rapid economic growth is reflected in its GDP. GST cuts will accelerate construction and electricity usage.
Shopkeepers must display old and new prices clearly. This ensures transparency for consumers. The GST structure is now simplified to two main rates. There is a 5% merit rate and an 18% standard rate, with a 40% rate for luxury goods.