ECONOMY
Prime Minister Narendra Modi announces two-tier GST regime by Diwali
- IBJ Bureau
- Aug 16, 2025
Prime Minister Narendra Modi on Friday announced a “double Diwali” bonanza for the people of India, saying that next generation of Goods and Services Tax (GST) reforms would be rolled out by October this year.
In his address to the nation on the Independence Day, the prime minister said that the GST rationalisation would help lower the cost of daily essentials and benefit the MSMEs.
“We have reduced the tax burden in the country over the last eight years. We made taxation easier,” Mr Modi said during his address.
The prime minister said that the rationalisation would help lower tax rates and boost the economy.
The GST Council, headed by Finance Minister Nirmala Sitharaman and comprising her State counterparts, in September 2021 had set up a group of ministers (GoM) to rationalise GST rates and suggest changes in slabs.
The GST rate rationalisation has been on the agenda for several months, with the focus on consolidation of the middle slabs, reduction in rates for essentials and broader structural changes to the tax regime.
The implementation of GST has replaced a maze of indirect taxes with a single, unified system. It has made tax compliance easier, reduced costs for businesses and allowed goods to move freely across States. By improving transparency and efficiency, GST has helped lay the foundation for a stronger, more integrated economy.
Report By
View Reporter News