India, Sept. 9 -- The GST Council has rolled out its biggest reform since the tax was first introduced, simplifying the system into three slabs, 5 per cent, 18 per cent, and a sin tax of 40 per cent. The last one is the Government's way to show that it will act aggressively on sinful and luxury items, which are used by the upper middle class and the rich. Products like pan masala, gutkha, cigarettes, aerated drinks and high-end luxury cars will fall in this de-merit bracket, making them considerably more expensive for the consumers.

On September 5, the shares of cigarette giant ITC fell by over two per cent, two days after the Government announced the sweeping changes. Earlier, cigarettes faced 88 per cent or more as effective tax, which...