PM Modi welcomes GST overhaul, says will benefit middle class, farmers and MSMEs

Prime Minister Narendra Modi on Wednesday welcomed the government’s sweeping proposal for next-generation reforms in the Goods and Services Tax (GST) regime which was  approved by the GST Council.

Referring to his Independence Day speech, where he had signaled the intent to overhaul the GST framework, PM Modi said the new measures are aimed at simplifying compliance, reducing tax burden on daily-use items, and ensuring ease of living for the common man.

“The Union Government had prepared a detailed proposal for broad-based GST rate rationalisation and process reforms, aimed at ease of living for the common man and strengthening the economy,” PM Modi posted on X.

He added that the proposals — which include major rate cuts and structural changes — were collectively agreed upon by the GST Council, comprising representatives from both the Centre and the states.

“These reforms will benefit the common man, farmers, MSMEs, the middle class, women, and youth,” the Prime Minister added.

The GST Council, chaired by Union Finance Minister Nirmala Sitharaman, on Wednesday approved sweeping rate rationalisation reforms, cutting down the existing four-rate GST structure to just two slabs - 5 per cent and 18 per cent.

The Council scrapped the 12 per cent and 28 per cent tax slabs, implementing a simplified two-rate system aimed at reducing the burden on consumers and boosting economic activity.

The reforms will come into effect from September 22, starting with revised tax rates on key goods and services.

With inputs from agencies