New GST Rates Kick In Today: Know What Are The Big Reliefs & What Will Pinch Pockets

New Delhi: In a major tax reform coinciding with the onset of Navratri, the Indian government’s new GST regime came into force on September 22, 2025. The reform cuts down the number of GST slabs and revises rates for a wide range of items. Most people will benefit — many household goods, food items, vehicles, and hotels will become cheaper. But some goods, especially in the luxury or high-value segments, will now attract higher GST, becoming more expensive.

The key change: GST slabs reduced to 5% and 18%, besides specially exempt (0%) and high-tax (40%) categories for sin and luxury goods.

What’s Cheaper, What’s Dearer

Cheaper:

Household goods (TVs, refrigerators etc.), food items, and many essentials are now cheaper due to lower GST rates or zero rates.

Drugs and medicines, insurance premiums (health, life), many types of breads (roti, paratha, chapati etc.), paneer/chena, and some other staples now attract 0% (nil) GST.

Many food preparations, dairy products (milk, butter, cheese etc.), edible oils & fats, dried fruits & nuts, etc., are now taxed at just 5%.

Dearer:

Goods of apparel and clothing/accessories where the sale value exceeds ₹2,500 per piece are now under the 18% GST bracket, up from the earlier lower tax rate (12%) for some.

Motor vehicles in certain categories — high-end cars, luxury vehicles, and those exceeding certain size or engine capacity limits — have moved into the 40% slab and will be more expensive.

Full List: New GST Rates by Slab

Below are item-wise lists of goods in each of the four GST categories under the new regime: 0% (nil), 5%, 18%, 40%. (Items marked with * are in categories where the new rate will come into effect from a future date as notified.)

0% or Nil GST Rate

UHT milk

Chena or paneer, pre-packaged and labelled

Pizza bread

Khakhra, chapathi or roti

Paratha, parotta and other Indian breads by any name called

Drugs and medicines such as Agalsidase Beta, Imiglucerase, etc. (various specified biologics and treatments)

Erasers

Uncoated paper and paperboard used for exercise books, graph books, laboratory notebooks and notebooks

Exercise books, graph books, laboratory note books and notebooks

Maps, hydrographic or similar charts; wall maps; atlases; printed topographical plans and globes

Pencil sharpeners

All individual health insurance, plus reinsurance

All individual life insurance, plus reinsurance

5% GST Rate

Condensed milk

Butter and other fats / oils derived from milk; dairy spreads

Cheese

Brazil nuts, dried, whether or not shelled or peeled

Other nuts, dried (almonds, hazelnuts, chestnuts, etc.)

Dates, figs, pineapples, avocados, guavas, mangoes (non-sliced, etc.), other dried fruits etc.

Citrus fruits dried; certain fruit varieties, etc.

Fruit dried (excl. some headings), mixtures of nuts or dried fruits (Chapter 8)

Malt, whether or not roasted

Starches; inulin

Live horses

Vegetable saps and extracts; pectic substances, pectinates etc.

Rubber bands

Talcum powder; face powder; hair oil; shampoo; shaving cream, shaving lotion; aftershave lotion

Dental floss; toothpaste; tooth powder

Toilet soap (other than industrial soap), in bars/cakes/moulded shapes etc.

Candles, tapers, handcrafted candles

Feeding bottles; plastic beads; nipples of feeding bottles

Pig fats, poultry fats, etc. (other than certain headings)

Fats & oils of fish or marine mammals; refined etc.

Other animal fats & oils etc.

Wool grease etc.

Edible mixtures/preparations of animal fats etc.

Margarine; glycerol etc.

Vegetable waxes, beeswax etc.

Sausages and similar products; preserved meat/fish etc.

Extracts, juices etc of meat/fish/crustaceans etc.

Refined sugar with flavouring etc; sugar cubes; sugar syrups (with some conditions)

Chocolate & other food preparations containing cocoa; confectionery; cocoa powder (conditions apply)

Food preparations of cereals etc. (without cocoa or less than some % of cocoa)

Corn flakes; pasta; noodles etc.

Pastry, cakes, biscuits & other bakers’ wares (excluding certain breads)

Vegetables, fruit, nuts, preserved or prepared under certain conditions

Tender coconut water, pre-packaged & labelled

Fruit or nut juices and vegetable juices, unfermented & with no spirit etc.

Extracts, essences etc of tea or mate; coffee extracts etc.

Yeasts; baking powders

Roasted chicory etc; blends/substitutes of coffee etc.

Soups and broths; homogenised composite food preparations

Sauces, mixed condiments; mustard flour & meal etc.

Ice cream & other edible ice (whether or not containing cocoa)

Texturised vegetable proteins (soya bari), pulses made into batters etc.

Namkeens, bhujia etc (ready to eat, pre-packaged and labelled)

Diabetic foods; food preparations not elsewhere specified; drinking water packed in 20-litre bottles

18% GST Rate

Bidis*

Portland cement, aluminous cement, slag cement, super sulphate cement etc.

Coal; briquettes etc manufactured from coal

Lignite etc (excluding certain “jet”)

Peat (including peat litter)

Goods made from other than natural menthol etc.

Odoriferous preparations which operate by burning (except agarbattis, etc.)

Biodiesel (other than that supplied to OMCs for blending with diesel)

New pneumatic tyres of rubber (excluding certain types)

Uncoated paper and paperboard used in writing, printing etc (other than certain exercise-book types)

Kraft paper etc in rolls or sheets etc.

Other uncoated paper/paperboard rolls/sheets not processed etc.

Greaseproof papers; glassine papers; composite paper etc.

Apparel and clothing accessories (knitted or crocheted) above ₹2,500 per piece

Apparel and clothing accessories (not knitted or crocheted) above ₹2,500 per piece

Made up textile articles / sets above ₹2,500 per piece

Internal combustion piston engines (spark-ignition or compression-ignition) etc.

Pumps for dispensing fuel or lubricants; related pumps/etc.

Household air-conditioning machines; machines with fan + elements for changing temp/humidity etc.

Dish-washing machines, household etc.

40% GST Rate

Pan masala*

Unmanufactured tobacco; tobacco refuse (excluding tobacco leaves)

Cigars, cheroots, cigarillos and cigarettes of tobacco or substitutes

Other manufactured tobacco and tobacco substitutes; homogenised or reconstituted tobacco etc.

Products containing tobacco or nicotine substitutes intended for inhalation without combustion

All goods (including aerated waters), containing added sugar or other sweetening matter or flavoured

Other non-alcoholic beverages

Caffeinated beverages

Carbonated beverages of fruit drink or carbonated beverages with fruit juice

Motor cars and other motor vehicles principally designed for transport of persons (excluding some specified categories)

Motor vehicles with spark-ignition piston engine + electric motor (hybrids) exceeding 1,200 cc or length exceeding 4000 mm

Motor vehicles with compression-ignition (diesel etc) + electric motor exceeding certain capacity or size

Motorcycles with engine capacity exceeding 350 cc

Aircrafts for personal use

Yachts and vessels for pleasure or sports

Revolvers and pistols, other than those of heading 9303 or 9304

Smoking pipes & cigar or cigarette holders, and their parts

Specified actionable claims defined under CGST Act (betting, casinos, gambling, online money gaming etc.)

So, what changes now?

Consumers buying everyday staples and essentials will see immediate relief due to zero or low (5%) GST on many items.

The rate increase for higher‐value clothing and luxury vehicles may hit middle and upper‐middle income buyers.

The change will also affect industries: manufacturers and retailers will need to update prices, billing systems etc.