The new Goods and Services Tax (GST) rates were finally activated on Monday. The GST reforms, or GST 2.0 as it is being famously called, have been the topic of much debate for weeks now as people wondered what would change, how it would impact people, and the biggest concern for the common citizen, at least, how heavy would it be on one’s wallet.
The government has claimed that this new era of tax reform aims to provide a simplified and citizen-friendly version of the GST.
Aimed at reducing the tax burden on essential goods and services, the reform has resulted in several items becoming cheaper, expensive, and some even completely tax-free.
What Is GST 2.0?
GST 2.0 is a complete reform of India’s Goods and Services Tax (GST) regime, announced by the Government and implemented from September 22, 2025. Finance Minister Nirmala Sitharaman announced the reforms at the 56th GST Council meeting on September 3, 2025.
Prime Minister Narendra Modi also addressed the nation on September 21, 2025, talking about these reforms.
He mentioned that the new GST rates, along with the earlier income tax reforms, can allow Indian citizens to save approximately ₹2.5 lakh crore.
The biggest change comes from the GST regime’s structure. Where earlier there were four main tax slabs (5%, 12%, 18%, and 28%), plus several special rates and varying tax treatments for items, GST 2.0 adopts a two-tier structure.
Now, most essential and daily‑use goods and services are taxed at 5% and 18%, while a 40% GST will be applied on ultra-luxury or sin items, these include tobacco, pan masala, bidis, online gaming and betting, horse racing, lottery, IPL tickets, luxury vehicles, aircraft, guns, and more.
Various items have become tax-free, encountering NIL GST. Here is a list of items that are now tax-free or have 0% GST:
Food items
- Chapati, roti, parotta, paratha, khakhra, kulcha, and pizza bread.
- Ultra-High Temperature (UHT) milk, pre-packaged and labelled paneer or chena.
- Fresh fruits, vegetables, pulses, dals, eggs, wheat flour, and rice.
Read More: Why Are Bengaluru Shopkeepers Saying No To UPI And Digital Payments, Only Taking Cash
Medical and healthcare products
- 33 critical medicines, including 3 specific drugs for cancer, rare diseases, and chronic conditions (including Agalsidase Beta, Imiglucerase, Eptacog alfa, Daratumumab, Onasemnogene abeparvovec, Risdiplam, among others).
- Medical-grade oxygen.
- All individual life and health insurance policies are now exempt from GST, including family floater plans and reinsurance.
Stationery items
- Pencils (even propelling or sliding pencils), erasers, sharpeners, crayons, and pastels.
- Writing or drawing chalk, tailor’s chalk, and chalk sticks.
- Notebooks, exercise books, graph books, and laboratory books.
- Uncoated paper and paperboard are used for exercise books.
- Maps, and hydrographic or similar charts of all kinds.
- Atlases, globes, wall maps, and topographical plans.
According to reports, the implementation of GST 2.0 will make around 375 items, including medicines, electronics, equipment, automobiles, and kitchen staples, cheaper for people.
One item in the 40% slab that is set to become quite expensive, which is also used by common people, would be aerated drinks.
Along with that, items containing added sugar or other sweetening matter or flavoured, non-alcoholic beverages, caffeinated beverages and carbonated beverages of fruit drink or carbonated beverages with fruit juice will also be taxed at 40%.
Image Credits: Google Images
Sources: Hindustan Times, The Economic Times, India Today
Find the blogger: @chirali_08
This post is tagged under: GST, GST tax-free, GST 2.0, GST 2.0 list, GST 2.0 reforms, GST 2.0 news, GST 2.0 changes, zero GST, GST reforms, tax free, GST tax free, new tax reforms
Disclaimer: We do not hold any rights or copyright over any of the images used; these have been taken from Google. In case of credits or removal, the owner may kindly email us.
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