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Prime Minister Narendra Modi on Sunday, September 21, announced the launch of next-generation Goods and Services Tax (GST) reforms from September 22, coinciding with the first day of Navratri. Calling it a “GST Savings Festival,” he said the new tax structure will directly benefit the poor, middle class, women, youth, farmers, and small businesses.
In his address to the nation on Sunday evening, the Prime Minister said, “From sunrise on September 22, a new chapter in India’s tax regime will begin.” Describing the reforms as the beginning of a “GST saving festival,” he added, “From tomorrow, you will be able to buy your favourite items with ease. This is like a GST saving festival for every Indian.”
PM Modi said that the poor and the new middle class are getting double benefits after the GST rate cuts. Greeting citizens on the occasion of Navratri, he said that the new phase of GST reforms will directly benefit the common man, farmers, MSMEs, middle-class families, women, and youth.
“With these reforms, savings of every Indian will increase, and people will be able to buy their preferred items more easily. This festive season, everyone’s happiness will multiply,” he said, adding that the new GST structure would boost India’s economic growth.
The government had earlier announced GST rate cuts on September 4, covering a wide range of products, from automobiles to daily consumer items. Under the new framework, often referred to as GST 2.0, a two-slab structure of 5% and 18% will apply, with an additional 40% rate only for super luxury, sin, and demerit goods.
This marks the biggest indirect tax reform since the Goods and Services Tax was rolled out in July 2017. The reforms were cleared by the GST Council at its 56th meeting, where both the Union and state governments reached a consensus. During his speech, PM Modi underlined that the reforms symbolise the cooperative spirit between the Centre and the states.
The Prime Minister said the decision to move forward with the new tax structure will make goods cheaper, encourage industry, and strengthen India’s economy. He termed the implementation of the next-generation GST reforms as a major step towards Aatmanirbhar Bharat.
Reflecting on the journey of GST, the Prime Minister recalled the challenges before 2017, when India’s tax system was entangled in a web of levies such as excise, VAT, and octroi. “For decades, our citizens and traders were caught in the maze of dozens of taxes. Moving goods from one city to another meant crossing multiple checkpoints, filing endless forms, and paying arbitrary tolls. The burden ultimately fell on the poor consumer,” he said.
Citing an example, PM Modi said that in 2014, a foreign newspaper had highlighted how a company found it easier to ship its goods from Bengaluru to Europe and then back to Hyderabad rather than directly sending them between the two cities, due to India’s complex tax structure.
He emphasised that the GST reform, launched in 2017 after extensive consultations with states and stakeholders, was a historic step in freeing the nation from such inefficiencies. “It was the result of joint efforts of the Centre and states that the dream of One Nation, One Tax became reality,” PM Modi said.
Stressing that reforms must evolve with time, the Prime Minister noted that the new generation GST reforms are aimed at simplifying processes, reducing costs, and empowering every section of society. “Reform is a continuous process. As times change, so must our systems. Tomorrow marks a new beginning,” he reiterated.