New Delhi: GST Council Meeting: The 56th meeting of the GST Council that kick off on Tuesday morning has announced the much anticipated big-bang reforms in GST tax structure. The changes in GST rates on services will be implemented with effect from 22nd September 2025.
The GST Council has accepted Group of Minister’s (GoM) proposal to retain two slabs — 5 percent and 18 percent.
Till date, As per Indian GST rules, a four-slab GST system was being followed — 5 percent, 12 percent, 18 percent, and 28 percent — along with an additional cess on sin and luxury goods.
(Also Read– New GST Rates: Full List Of Items Becoming Cheaper From September 22)
“This reform is not just on rationalising rates, it’s also on structural reforms, ease of living, so that businesses can work together with great ease. We have corrected inverted duty structure problems, we have resolved classification related issues, and we have ensured there will be stability and predictability about the GST Reforms,” Finance Minister Nirmala Sitharaman said in a press briefing.
The changes in GST rates of all goods except pan masala, gutkha, cigarettes, chewing tobacco products like zarda, unmanufactured tobacco and bidi, will be implemented with effect from 22nd September 2025, said the
Ministry of Finance.
Pan Masala, gutkha, cigarettes, chewing tobacco products like zarda, unmanufactured tobacco and bidi will continue at the existing rates of GST and compensation cess where applicable, till loan and interest payment obligations under the compensation cess account are completely discharged.
Union Finance Minister and Chairperson of the GST Council may decide the actual date of transition to the revised rates of GST approved by the Council for the above-mentioned goods. Pending requisite amendments in CGST Act, 2017, Central Board of Indirect Taxes and Customs (CBIC) shall administratively start implementation of the revised system of grant of 90% provisional refunds arising out of Inverted Duty structure on the basis of data analysis and risk evaluation done by the system, as in the case of risk based provisional refunds on account of zero-rated supplies, Finance Ministry added.