GST 2.0: A New Era of Taxation and Consumer Relief in India

Uttar Pradesh Congress President Ajay Rai has intensified his critique of the Central Government regarding the Goods and Services Tax (GST), reiterating Congress party's longstanding objections since its introduction in 2017. In a statement to ANI, Rai highlighted how Congress MP Rahul Gandhi had forewarned about the 'Gabbar Singh Tax' potentially wreaking havoc on trade and traders.

Rai recalled Gandhi's foresight when GST was initially implemented eight years ago, asserting that Gandhi had already proclaimed the tax to be detrimental to both the nation and its trading community. According to Rai, during that period, senior BJP officials did not apprize traders of the potential financial setbacks and imminent tax obligations. This comes in the wake of the GST 2.0 reforms, sanctioned by the Union Government, which came into effect today, September 4.

The revised GST framework consolidates the previous four-tier slabs into two primary categories: 5 percent and 18 percent. Products previously taxed at 12 percent now fall under the 5 percent category, and items from the 28 percent slab have been reduced to 18 percent. This restructuring allows essential commodities and daily-use goods to be taxed at the lowest rates, making them more affordable. A distinct 40 percent slab remains for luxury and sin goods.

This new structure aims to simplify compliance processes, lower consumer prices, bolster manufacturing, and aid various sectors, ranging from agriculture to the automotive industry and fast-moving consumer goods (FMCG) to renewable energy. The reforms are designed to decrease living expenses, fortify MSMEs, expand the tax base, and foster inclusive economic growth. Following the GST adjustment, major FMCG and dairy brands like Amul and Mother Dairy have announced notable price reductions, passing on the benefits directly to consumers.

Products such as milk, butter, ghee, paneer, cheese, ice cream, snacks, and frozen foods are now under the 5 percent slab. As a result, the price of 100g of Amul butter has decreased from Rs 62 to Rs 58, while Ultra High Temperature (UHT) milk has reduced from Rs 77 to Rs 75 per liter. Likewise, Mother Dairy has cut prices on milkshakes, paneer, ghee, and frozen goods, offering welcome fiscal relief to consumers. (ANI)