New Delhi: Union Finance Minister Nirmala Sitharaman announced the new GST tariff two slabs 5% and 18% will be implementing from September 22^nd.  After a meeting of the GST Council she said that these reforms have a multi-sectoral and multi-thematic focus, aimed at ensuring ease of living for all citizens and ease of doing business for all.

The new structure will be implemented from September 22^nd. For the common man, it means more money in hand. This, the Government hopes, will be routed into the economy, giving it a significant boost and having a revenue implication of Rs 48,000 crore.

The GST Council announced on Wednesday that only two rates will remain from September 22^nd i.e., 5% and 18%. There is a special rate of 40% which will apply only to pan masala, cigarette, aerated water with added sugar, carbonated beverages, etc.

From groceries and fertilizers to footwear, textiles, and even renewable energy, a broad basket of goods and services is set to become more affordable. Items earlier taxed at 12% and 28% will now largely migrate to the other two slabs, making a wide range of products cheaper.

Ms Sitharaman said many items used by the middle class have been brought under 18%. These include televisions, air-conditioners, and bikes under 350 CC.

The  complicated GST slabs that gave headaches to small traders after the flagship tax overhaul came into effect, was cleaned up by the government today, leaving only two slabs – 5% and 18%.

We look at what has become cheaper:

Milk products: Ultra-high temperature (UHT) milk will now be tax-free (down from 5 %), while condensed milk, butter, ghee, paneer, and cheese have moved from 12% to 5% or nil in some cases.

Staple foods: Malt, starches, pasta, cornflakes, biscuits, and even chocolates and cocoa products will see rates reduced from 12-18% to 5%.

Dry fruits and nuts: Almonds, pistachios, hazelnuts, cashews, and dates, earlier taxed at 12%, will now attract just 5%.

Sugar and confectionery: Refined sugar, sugar syrups, and confectionery items like toffees and candy have shifted to the 5% slab.

Other packaged foods: Vegetable oils, animal fats, edible spreads, sausages, meat preparations, fish products, and malt extract-based packaged foods have been moved to the 5% slab.

Namkeens, bhujia, mixture, chabena and similar edible preparations ready for consumption form (other than roasted gram), pre-packaged and labelled to go from 18% to 5%.

Water, including natural or artificial mineral waters and aerated waters, not containing added sugar or other sweetening matter, nor flavoured to move from 18% to 5%.

Fertilisers are down from 12%/18%to 5%.

Select agricultural inputs, including seeds and crop nutrients, have been rationalised from 12% to 5%.

Life-saving drugs, health-related products, and some medical devices have seen rate cuts from 12%/18%to 5%or nil.

Entry-level and mass-use items like select electrical appliances will move from 28%to 18%.

Footwear and textiles have seen GST cut from 12% to 5%, reducing costs for mass-market products.

However, certain goods and services remain firmly under higher taxation.

Pan masala, gutkha, cigarettes, chewing tobacco, zarda, unmanufactured tobacco, and bidi will continue under existing high GST rates and compensation cess until outstanding cess-linked loans are cleared.

Additionally, the valuation of these products will now be shifted to Retail Sale Price (RSP) instead of transaction value, tightening compliance.

All goods (including aerated waters), containing added sugar or other sweetening matter or flavoured to go from 28% to 40%.

A new 40%slab for sin and luxury goods remains, ensuring that items like cigarettes, premium liquor, and high-end cars don’t see tax relief.

Imported armoured luxury sedans will be exempt only in special cases, such as those brought in by the President’s Secretariat.

There is also exemption of GST on all individual life insurance policies whether term life, ULIP or endowment policies and reinsurance thereof to make insurance affordable for common people and increase insurance coverage in the country.

GST has been removed from Ultra-High Temperature (UHT) milk, prepackaged and labelled chena or paneer, and all Indian breads such as chapati, roti, paratha, parotta, etc.