India, Aug. 16 -- justify;">The Central government has proposed two tax rates of 5% and 18% in the revamped goods and services tax (GST), slated to replace the current indirect tax regime by Diwali this year, according to media reports.

While the presently nil or zero per cent GST tax is charged on essential food items, 5% is charged on daily use items, 12% on standard goods, 18% on electronics and services, and 28% on luxury and sin goods, the revamped GST regime will have two slabs plus a special rate of 40% for luxury and 'sin' goods.

The development comes hours after Prime Minister Narendra Modi, during the Independence Day address, promised next generation Goods and Services Tax (GST) reforms as a Diwali gift for the country.

In r...