Introduction:
India’s GST regime undergoes a transformative overhaul following the 56th GST Council meeting on September 3, 2025, led by Finance Minister Nirmala Sitharaman. Effective September 22, 2025—the start of Navratri—the reforms simplify the four-tier structure (5%, 12%, 18%, 28%) into three: 5%, 18%, and 40% for ultra-luxury items, while tobacco remains at 28% + cess. This rationalization impacts 375 goods and services, slashing rates on daily essentials to boost consumption and ease inflation pressures. About 99% of items in the 12% slab move to 5%, and 90% of 28% to 18%, promising visible price drops on kitchen items, electronics, medicines, automobiles, and more. Services like beauty treatments, health clubs, and yoga drop from 18% (with input tax credit) to 5% (without ITC), while insurance premiums may fall. The government mandates retailers to display discounts, with sales data sharing to highlight benefits. Why does this matter? Amid festive season, these cuts could inject ₹50,000 crore into the economy via higher spending, per industry estimates, while fixing inverted duty structures for businesses. Exemptions apply for pre-September 22 supplies, and ITC reversal under Section 18(4) ensures smooth transition. As of September 22, 2025, 10:00 AM IST, this article details the full list of cheaper items, impacts, FAQs, and historical context.
Full List of Cheaper Items from September 22
The GST Council reduced rates on 375 items, focusing on essentials. Key categories:
Kitchen Staples and Dairy (5% from 12%):
- Ghee, butter, cheese, milk powder.
- Edible oils, flour, rice, pulses.
- Spices, tea, coffee (excluding luxury blends).
- Amul slashes prices on 700+ packs: Ghee ₹10-₹20 cheaper per 500g; butter ₹5 per 100g; ice cream ₹10 per liter; bakery ₹5-₹10.
Electronics and Appliances (18% from 28%):
- Mobile phones (unchanged at 18%).
- Laptops, tablets, monitors.
- Air conditioners, refrigerators, washing machines, dishwashers—up to ₹2,000-₹5,000 savings on mid-range models.
- LED lights, fans, small appliances.
Medicines and Health (5% from 12%):
- Basic drugs, vitamins, OTC medicines.
- Health equipment like BP monitors, glucometers.
- Beauty services (salons, yoga, gyms) at 5% without ITC—salon bills down 13%.
Automobiles (18% from 28%):
- Cars up to 1,500cc petrol/1,250cc diesel: ₹20,000-₹50,000 off on Maruti, Hyundai models.
- Bikes up to 350cc at 18%; above 350cc at 40%.
- Jeep, Tata, Mahindra pass on full benefits.
Other Essentials (5% or 18%):
- Soaps, detergents, toothpaste (5%).
- IPL tickets, insurance premiums (18% from 18% with ITC, but lower effective).
- Paper products, batteries (18% uniform).
Ultra-luxury (40%): High-end cars, jewelry. Tobacco unchanged at 28% + cess.
Impacts on Consumers and Businesses
Consumers: Immediate Diwali relief—groceries down 7%, appliances 10%, cars 5-8%. Amul’s cuts save ₹10-20 on staples; Maruti’s on Alto ₹20,000 off.
Businesses: Fixes inverted duties (e.g., inputs 18%, outputs 5%) via refunds, boosting cash flow. Retailers must display discounts; non-compliance fines up to ₹10,000.
Economy: ₹50,000 crore consumption boost; inflation down 0.5%.
Historical Context: GST Evolution
GST launched July 1, 2017, with four slabs; 2021 added 12% for essentials.
Statistics: Rate Changes and Savings
- Items Affected: 375 (99% 12% to 5%, 90% 28% to 18%).
- Slabs: 5%, 18%, 40% (luxury); tobacco 28% + cess.
| Category | Old Rate | New Rate | Savings Example |
|---|---|---|---|
| Dairy (Ghee) | 12% | 5% | ₹10/500g |
| AC/Fridge | 28% | 18% | ₹2,000-₹5,000 |
| Cars (Mid-Range) | 28% | 18% | ₹20,000-₹50,000 |
| Beauty Services | 18% ITC | 5% No ITC | 13% Bill Drop |
Economic impact: ₹50,000 crore boost.
Expert Opinions: Welcome Relief or Temporary Fix?
Sitharaman: "Simplifies tax, benefits common man."
Potential Impacts: Festive Sales and Long-Term
Diwali sales up 15%; businesses gain ₹10,000 crore from ITC fixes.
Conclusion: GST Cuts Usher in Cheaper Diwali
From September 22, 2025, GST reforms make essentials cheaper, from ghee to cars, simplifying slabs to 5% and 18%. Retailers, display discounts; consumers, save big. Updates at nuvexic.com.
FAQ
Effective date?
September 22, 2025.
Items cheaper?
Kitchen staples, electronics, medicines, cars, beauty services.
New slabs?
5%, 18%, 40% (luxury).
ITC impact?
Reversal for pre-September 22 supplies.
Tobacco?
Unchanged at 28% + cess.
Savings example?
₹20,000 on mid-range cars.
