Big Tax Relief Coming: Centre Plans Major GST Relief, Essential Goods May Get Cheaper Soon
According to official sources, the Centre is considering removing the 12 percent GST slab altogether, or reducing it to 5 percent, to bring down the prices of daily-use commodities.
The Central Government is preparing to announce a major reduction in Goods and Services Tax (GST) on several essential household items, giving a big boost to middle-class and lower-income families. According to official sources, the Centre is considering removing the 12 percent GST slab altogether, or reducing it to 5 percent, to bring down the prices of daily-use commodities.
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What’s Changing in the GST Slab?
Currently, the 12 percent GST slab includes several items that are commonly used in Indian households. By tweaking or eliminating this slab, the government aims to make essential goods more affordable, thereby increasing consumer demand and overall consumption.
If implemented, this change will cost the central government around Rs 40,000 to Rs 50,000 crore annually in revenue loss. However, officials believe the move will lead to a surge in product sales, which can potentially balance out the loss via higher overall GST collections.
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Finance Minister Hinted at Relief Earlier
A few days ago, Finance Minister Nirmala Sitharaman had hinted at changes in the GST structure. She emphasized that reforms were being planned to give relief to middle-class households, further strengthening speculation about the removal or reduction of the 12 percent GST category.
Which Items Will Get Cheaper?
If the plan goes through, the following 14 essential items currently in the 12 percent slab could become significantly cheaper:
- Toothpaste, Tooth Powder
- Umbrellas
- Sewing Machines
- Pressure Cookers and Other Kitchenware
- Electric Iron Boxes
- Geysers (Water Heaters)
- Low-Capacity Washing Machines
- Bicycles
- Readymade Garments Priced Above Rs 1,000
- Footwear Priced Between Rs 500 and Rs 1,000
- Stationery Items
- Vaccines
- Ceramic Tiles
- Agricultural Equipment
Why This Move Now?
The government sees this as a strategic move ahead of the festive season and possibly the next Union Budget. By reducing the tax burden on essential goods, the Centre hopes to:
- Boost domestic consumption
- Drive up production
- Support manufacturing
- Make living costs more affordable for families
What’s Next?
The GST Council is expected to meet soon to finalize the changes. If approved, these reforms could be implemented in the coming months, just in time for major shopping periods and upcoming elections in various states.
This move is likely to be welcomed by the public, especially at a time when inflation and living costs are on the rise.
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