New Delhi, Sept. 21 -- India's GST 2.0 reform, effective September 22, 2025, introduces a streamlined tax structure with two primary rates, 5% and 18% and a 40% rate for luxury and sin goods. This change simplifies the previous four-slab system (5%, 12%, 18%, and 28%). The overhaul is aimed at boosting consumer spending, easing business operations, and driving economic growth.

The reduction of GST on daily essentials like milk, medicines, and packaged foods from 12% to 5% is set to lower costs for consumers. This change will directly increase disposable income.

"Since tax rates on consumer durables, health, and medical goods are reduced, it will increase demand both in urban and rural areas," said CA Bishan Shah, Chairman, GST and IDT C...