New Delhi, Aug. 18 -- Prime Minister Narendra Modi has set the stage for a transformative rejig of India's goods and services tax (GST) regime by Diwali. "We have discussed with states and we are bringing next-generation GST reforms that will reduce the tax burden," he said in his Independence Day speech on 15 August.

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The government reportedly has a two-slab GST rate structure in mind for the most part: items would be taxed at either 5% or 18%, with a 40% rate applicable to a handful of luxury and so-called sin goods. If this eases the bulk burden, it could stimulate consumption.

Along with refunds being processed faster and inverted duty structures being ...