Source: The Economic Times
New Delhi, 4 September 2025 – Piyush Goyal, Union Minister of Commerce and Industry, described the latest Goods and Services Tax (GST) changes as a “game-changer”. It will benefit every consumer, and it will move India towards the goal of becoming a developed nation by 2047.
Goyal spoke at the India MedTech Expo 2025, where he described the reforms as transformational and encouraged businesses and industries to share the benefits with the people. “Pass on all these benefits of GST to the consumers.”
“Yesterday’s reform in indirect taxes in GST, coming on the back of several initiatives over the last 11 years, is transformational in nature, significantly impacting the pharma sector, significantly impacting so many sectors, right from the farmer until our MSMEs,” he said.
“Every stakeholder in the country, every consumer, stands to benefit,” Goyal added.
The minister said sectors such as pharmaceuticals and nutraceuticals were going to benefit the most from lower taxes and that these reforms would play a major role in the ambitious economic journey ahead for India.
Significant Changes in GST
The reforms approved by the GST Council on September 3 were the most consequential since the tax was instituted in 2017. The council, which is chaired by Finance Minister Nirmala Sitharaman, decided to reduce the number of tax slabs from four to two main rates – 5% and 18%, and would also include a 40% Special rate.
Some of the highlight decisions are:
- Lower taxes on daily use items, such as corn flakes, hair oil, TVs, and insurance policies.
- Prefilled GST returns to lower paperwork.
- A seven (7) day refund window for exporters.
- Launch the new system on September 22, 2025, just prior to the festive season.”
Effect on the Economy
The reform advocates claim that the reforms will increase consumption, relieve household stress, and eventually promote small business growth. They feel that consumers will enjoy lower prices on groceries, medications, and other consumer goods.
The reform has also improved market views. Shares of FMCG companies, automobile manufacturers, cement makers, and new-age companies like PB Fintech, Nykaa, and FirstCry increased at the announcement.
Industry leaders and trade bodies (FICCI), noticed the reforms and supported the changes that were made to further the republican agenda of simplifying taxation to provide greater ease to doing business.
The Government’s Long-Term Vision
Prime Minister Narendra Modi welcomed the GST Council’s decision, stating that these changes would make compliance simpler and would benefit all sections of society and hence increase revenue. He further said that the reforms were part of the government’s next-generation tax strategy.
Officials have also indicated that these changes could lead to a single GST 2025 slab by 2047, which will complete the goal of “One Nation, One Tax.”
With these changes to GST 2.0, it is expected to make goods and services cheaper, simplify the tax process, and give a big boost to the economy in India.
