GST 2.0 May Cut Prices on Daily-Use Items Soon
Key Highlights
GST 2.0 is a bold plan that will make many everyday items cheaper. Right now we deal with four GST rates 5, 12, 18, and 28 percent. The new proposal cuts this to just two basic rates. Essentials like food, clothes, and personal care items may drop to 5 percent while most others move to 18 percent. Goods like soda, electronics, and cement could be part of the 18 percent group. Extra-high taxes up to 40 percent will stay only on luxury or harmful products like tobacco or online gaming.
Let us look at what you might buy less expensively soon:
Groceries & Food staples: Things you use every day like butter, ghee, cheese, noodles, jam, and even toothpaste could come down from 12 percent to just 5 percent. That could cut your household grocery bill by hundreds of rupees each month.
Home appliances & electronics: Air conditioners, fridges, TVs, and washing machines often have 28 percent tax. Under GST 2.0, they may drop to 18 percent, saving buyers ₹1,500 ₹2,500 per item.
Vehicles: Small cars and two-wheelers taxed at 28 percent may shift to 18 percent. That could reduce the tax component by thousands of rupees, making them easier to buy.
Construction items: Cement and building materials could also benefit from the 18 percent rate, easing costs for home buyers and builders.
Insurance and health costs: Plans for personal life and health insurance may enjoy lower rates or even tax relief, helping families manage medical expenses better.
Experts expect these changes to lower inflation and add a boost to demand. One estimate says GDP could rise by 0.5-0.6 percent, and household spending will feel lighter.
The GST Council is set to meet in early September, and implementation may happen before Diwali. Officials say it will be a real festive gift for people.
Editor Insights
For most households this reform arrives just in time. Rising prices of basic goods especially food have squeezed budgets. A shift of essential groceries to 5 percent may bring real relief. Families could notice savings in every shopping trip. If you spend ₹10,000 monthly on groceries, you could keep ₹400-₹600 more in your pocket.
Homebuyers and car buyers will feel relief too. That AC or two-wheeler you wanted may now be within reach. Savings on appliances and vehicles brings hope for middle-income families planning upgrades during the festive season.
Building and construction costs will fall too. Lower GST on cement can lower costs of homes, rentals, and renovation projects. New tax rules may also help small businesses and traders, who often face issues with classification, refunds, and compliance under the old GST system. A simpler tax slab means fewer disputes and faster refunds.
There are fiscal trade-offs. The change may cost the government billions. But consumer demand may rise fast enough to make up for it. Markets believe this could spur consumption and support companies in FMCG, auto and consumer durables. Policymakers may rely on new GST collections, growth, and dividends to balance budgets. State revenues will need special attention too.
As India heads into a festival season, these reforms offer both simplicity and savings. If approval comes timely, 2025 could bring relief as well as a renewed push for growth. GST 2.0 may change how India shops, buys, and saves.
Also Read: Parineeti Chopra and Raghav Chadha Share Joyful News of Pregnancy
Source & Attribution
This article draws on verified reports from news agency and expert commentary. Key sources include:
Next-gen GST plan announced by Prime Minister Modi during Independence Day speech
Two-slab GST structure with proposed 5%, 18%, and 40% for sin goods
Details on cheaper goods like groceries, appliances, vehicles, cement, and insurance
Group of Ministers and GST Council timeline for implementation by Diwali
Disclaimers
This article is based on publicly available policy proposals and media coverage as of August 2025. Final GST changes require approval by the GST Council and may be subject to revisions. EveningHeadline.com does not guarantee implementation timelines or final rates. Always refer to official government announcements for confirmation.
I run Evening Headlines where I share quick and complete news updates so readers can stay informed without wasting time. I work as a cost accountant but I also follow cricket, the economy, investments, movies, and social causes. I enjoy turning big stories into short, clear summaries that anyone can understand. I also create content on my other sites like Wealth Vartalap, Christmas Time Clock, Cashplanter, and Abhishek Listing. My goal is simple make news easy to follow and worth reading every day.