New Delhi : GST rationalisation benefits will directly support people with low income, the middle class, the new middle class, youth, farmers, women, shopkeepers, and entrepreneurs, Finance Minister Nirmala Sitharaman said on Monday. She explained that the reforms will ease the tax burden, promote local manufacturing, and strengthen cooperative federalism.
She explained that the rate rationalisation (5% and 18%) will support local manufacturing and strengthen cooperative federalism.
“We should all work to accelerate growth, make it easy for businesses to operate, and attract investment. Such a big tax reform became possible because all states worked together since 2017,” the finance minister said, quoting Prime Minister Narendra Modi’s Sunday address.
Sitharaman also criticised the opposition, saying: “PM Modi’s address carried several positive messages. Unfortunately, the opposition and its social media ecosystem spread negativity and baseless criticism.”
She stressed that GST reforms have reduced the tax burden on citizens.
Products earlier taxed at 12% and 18% have mostly shifted to the lower 5% bracket, while certain essentials now carry zero tax. This move, she said, will significantly benefit all 1.4 billion Indians.
The government also introduced a special 40% tax rate on goods considered harmful or excessively luxurious, such as cigarettes, tobacco, pan masala, soft drinks, and high-end luxury cars.
The GST Council, comprising representatives from all states and union territories, unanimously approved the reforms.
The Centre expects the simplified tax structure to lower the prices of essential goods, boost consumption, and drive economic activity.
PM Modi highlighted that nearly 99% of products earlier taxed at 12% now fall in the 5% category. He emphasised that the reform will make essential and lifestyle goods — from groceries and medicines to TVs, refrigerators, two-wheelers, cars, and even hotel stays — more affordable for citizens.
–IANS
