GST Reforms Will Directly Benefit Every Section of Society, Says PM

Question mark on whether benefits will be passed on to consumers: Congress

PTI, New Delhi, Sept 22, 2025 :  Prime Minister Narendra Modi on Monday said the next-generation GST reforms will boost savings and directly benefit every section of society, as he asserted that it is imperative to walk on the path of self-reliance to achieve the collective goal of Viksit Bharat by 2047.

In an open letter to Indians, which he posted on X, Modi said that from September 22, next-generation GST reforms have begun to make their presence felt, marking the start of a “GST Bachat Utsav” or “GST Savings Festival” across the country.

“This year, the festive season brings an added reason to rejoice. These reforms will boost savings and directly benefit every section of society, be it farmers, women, youth, poor, middle class, traders or MSMEs. They will encourage greater growth and investments and accelerate the progress of every state and region,” the Prime Minister said.

An important feature of the next-generation GST reforms is that there will mainly be two slabs — five per cent and 18 per cent, he said.

“Daily essentials such as food, medicines, soap, toothpaste, insurance and many more items will now either be tax-free or fall in the lowest five per cent tax slab. Goods that were earlier taxed at 12 per cent have almost entirely shifted to five per cent. It is greatly heartening to see various shopkeepers and traders putting up the ‘then and now’ boards which indicate taxes pre-reforms and post-reforms,” Modi said in his letter to the people.

In the last few years, 25 crore people have risen above poverty and formed an aspirational neo-middle class, he said.

“Further, we have also strengthened the hands of our middle class with the massive income tax cuts, which ensure zero tax up to the annual income of ₹12 lakh. If we combine the income tax cuts and the next-generation GST reforms, they add up to savings of nearly ₹2.5 lakh crore for the people,” he said.

“Your household expenses will reduce and it will be easier to fulfil aspirations such as building a home, purchasing a vehicle, purchasing appliances, eating out or planning a family vacation,” the Prime Minister said.

Noting that the nation’s GST journey, which began in 2017, was a turning point in freeing citizens and businesses from the web of multiple taxes, Modi said the GST united the nation economically.

“‘One Nation, One Tax’ brought uniformity and relief. The GST Council, with the active participation of both Centre and states, took many pro-people decisions. Now, these new reforms take us further, simplifying the system, reducing rates and putting more savings in the hands of the people,” he said.

“Our small industries, shopkeepers, traders, entrepreneurs and MSMEs will also see greater Ease of Doing Business and Ease of Compliance. Lower taxes, lower prices and simpler rules will mean better sales, less compliance burden and growth of opportunities, especially in the MSME sector,” he said.

Asserting that the collective goal of the people is Viksit Bharat by 2047, Modi said that in order to achieve it, walking on the path of self-reliance is imperative.

“These reforms strengthen our local manufacturing base, paving the way towards Aatmanirbhar Bharat,” he said.

Meanwhile, the Congress on Monday said the “limited” reform comes eight years too late and a “big question mark” remains on whether the benefits of tax reduction will be passed on to consumers.

Congress general secretary in-charge of communications, Jairam Ramesh, said the National Anti-profiteering Authority (NAA) was established under Section 171 of the Central Goods and Services Tax Act, 2017, to monitor whether GST rate cuts resulted in the reduction of consumer prices but was rendered “toothless” by the Narendra Modi government with a notification issued on September 30, 2024.

“It should not be a case of ‘vote chori’ on one hand and ‘munafakhori (profiteering)’ on the other hand with the people not getting the benefits of the GST reduction,” Ramesh told newspersons.