Union finance minister
Nirmala Sitharaman on Sunday described the latest
Goods and Services Tax (GST) reforms as a huge victory for every Indian, saying they would ease the tax burden on citizens while giving a boost to the economy.
Speaking at a joint conclave of trade and industry associations in Chennai titled ‘Tax Reforms for Rising Bharat’, Sitharaman underlined that almost all items previously taxed at 12 per cent have now been brought down to 5 per cent.
“Ninety-nine per cent of all goods which were earlier in the 12 per cent GST bracket have now been reduced to 5 per cent,” she said, according to news agency ANI.
She noted that the changes, finalised at the 56th GST Council meeting on September 3, will take effect from September 22, the first day of Navratri, well before Diwali. The decision was taken unanimously by all states.
“To expedite Prime Minister Modi’s vision of achieving Viksit Bharat, we took steps to reform GST. In the last eight months we studied and ensured simplification so that there is no classification problem,” PTI quoted her as saying.
At the event, Sitharaman launched two publications — GST 2.0 – Fuelling India’s Growth and GST Reforms for Tamil Nadu’s Growth. She stressed that GST touches citizens’ lives “from morning till night” through essential goods, adding that input costs will fall significantly with the new structure.
The minister highlighted that in 2017 there were only 65 lakh registered GST taxpayers, a number that has now risen to 1.51 crore. “If GST were truly a ‘Gabbar Singh Tax’ as critics allege, taxpayers would not have increased so significantly,” she remarked.
Over 350 products have seen rate cuts, including groceries, packaged foods, handicrafts such as Thanjavur dolls, and household goods. Refund issues raised by small businesses have also been addressed, with 90 per cent of refunds processed quickly while only 10 per cent are withheld for verification.
Industry voices at the Chennai event also welcomed the reforms. IIT-Madras director V. Kamakoti said GST exemptions for research funding had been vital for higher education, praising the cuts on educational and healthcare items that will help middle- and lower-income families.
He further noted that reduced taxes on consumer goods such as TVs, washing machines and small cars would spur production, logistics, and job creation.
Tamil Nadu Traders’ Federation president Vikramraja recalled the difficulties during GST’s initial rollout but said continuous dialogue had brought improvements. He welcomed the cut in grocery tax from 18 per cent to 5 per cent but urged the government to curb harassment by tax officials and implement the trader welfare board.
Tamil Nadu BJP chief Nainar Nagendran described Sitharaman as “a source of pride for Tamils” in Parliament, adding that GST rate cuts would further accelerate construction, electricity consumption, and consumer demand.
He also called for shopkeepers to clearly display both old and new prices after the cuts to ensure transparency.
The sweeping reform simplifies GST from four slabs (5, 12, 18, 28 per cent) into two principal rates — 5 and 18 per cent — with a special 40 per cent rate for luxury and sin goods.
Sitharaman concluded by stressing that reforms would continue, particularly in agriculture, MSMEs, food, and essential services.
“GST reforms are not just about rate cuts but about building trust, boosting demand, and propelling India towards its 2047 vision,” she said.
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