{"id":29706,"date":"2025-08-19T19:21:27","date_gmt":"2025-08-19T13:51:27","guid":{"rendered":"https:\/\/carajput.com\/blog\/?p=29706"},"modified":"2025-08-20T16:59:12","modified_gmt":"2025-08-20T11:29:12","slug":"gst-council-meetings-in-september-and-the-possible-gst-reforms","status":"publish","type":"post","link":"https:\/\/carajput.com\/blog\/gst-council-meetings-in-september-and-the-possible-gst-reforms\/","title":{"rendered":"GST Council meetings in September and the possible GST reforms:"},"content":{"rendered":"<div id=\"ez-toc-container\" class=\"ez-toc-v2_0_58 counter-hierarchy ez-toc-counter ez-toc-light-blue ez-toc-container-direction\">\n<p class=\"ez-toc-title\">Page Contents<\/p>\n<label for=\"ez-toc-cssicon-toggle-item-69d8cdb5dc6f3\" class=\"ez-toc-cssicon-toggle-label\"><span class=\"\"><span class=\"eztoc-hide\" style=\"display:none;\">Toggle<\/span><span class=\"ez-toc-icon-toggle-span\"><svg style=\"fill: #000000;color:#000000\" xmlns=\"http:\/\/www.w3.org\/2000\/svg\" class=\"list-377408\" width=\"20px\" height=\"20px\" viewBox=\"0 0 24 24\" fill=\"none\"><path d=\"M6 6H4v2h2V6zm14 0H8v2h12V6zM4 11h2v2H4v-2zm16 0H8v2h12v-2zM4 16h2v2H4v-2zm16 0H8v2h12v-2z\" fill=\"currentColor\"><\/path><\/svg><svg style=\"fill: #000000;color:#000000\" class=\"arrow-unsorted-368013\" xmlns=\"http:\/\/www.w3.org\/2000\/svg\" width=\"10px\" height=\"10px\" viewBox=\"0 0 24 24\" version=\"1.2\" baseProfile=\"tiny\"><path d=\"M18.2 9.3l-6.2-6.3-6.2 6.3c-.2.2-.3.4-.3.7s.1.5.3.7c.2.2.4.3.7.3h11c.3 0 .5-.1.7-.3.2-.2.3-.5.3-.7s-.1-.5-.3-.7zM5.8 14.7l6.2 6.3 6.2-6.3c.2-.2.3-.5.3-.7s-.1-.5-.3-.7c-.2-.2-.4-.3-.7-.3h-11c-.3 0-.5.1-.7.3-.2.2-.3.5-.3.7s.1.5.3.7z\"\/><\/svg><\/span><\/span><\/label><input type=\"checkbox\"  id=\"ez-toc-cssicon-toggle-item-69d8cdb5dc6f3\"  aria-label=\"Toggle\" \/><nav><ul class='ez-toc-list ez-toc-list-level-1 ' ><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-1\" href=\"https:\/\/carajput.com\/blog\/gst-council-meetings-in-september-and-the-possible-gst-reforms\/#GST_Council_meetings_in_September_and_the_possible_GST_reforms\" title=\"GST Council meetings in September and the possible GST reforms:\">GST Council meetings in September and the possible GST reforms:<\/a><ul class='ez-toc-list-level-3'><li class='ez-toc-heading-level-3'><a class=\"ez-toc-link ez-toc-heading-2\" href=\"https:\/\/carajput.com\/blog\/gst-council-meetings-in-september-and-the-possible-gst-reforms\/#Proposed_GST_Rate_Changes\" title=\"Proposed GST Rate Changes \">Proposed GST Rate Changes <\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-3'><a class=\"ez-toc-link ez-toc-heading-3\" href=\"https:\/\/carajput.com\/blog\/gst-council-meetings-in-september-and-the-possible-gst-reforms\/#In_summary_Current_Tax_Rates_on_Cars_GST_Cess_Total_Tax\" title=\"In summary Current Tax Rates on Cars (GST + Cess = Total Tax %)\">In summary Current Tax Rates on Cars (GST + Cess = Total Tax %)<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-3'><a class=\"ez-toc-link ez-toc-heading-4\" href=\"https:\/\/carajput.com\/blog\/gst-council-meetings-in-september-and-the-possible-gst-reforms\/#GST_Council_Meetings_September_2025\" title=\"GST Council Meetings (September 2025)\">GST Council Meetings (September 2025)<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-3'><a class=\"ez-toc-link ez-toc-heading-5\" href=\"https:\/\/carajput.com\/blog\/gst-council-meetings-in-september-and-the-possible-gst-reforms\/#Summary_Table\" title=\"Summary Table\">Summary Table<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-3'><a class=\"ez-toc-link ez-toc-heading-6\" href=\"https:\/\/carajput.com\/blog\/gst-council-meetings-in-september-and-the-possible-gst-reforms\/#Total_Impact_on_Indian_Market_Outlook_%E2%80%93_Fiscal_Policy_Considerations\" title=\"Total Impact on Indian Market Outlook &#8211;\u00a0Fiscal &amp; Policy Considerations\">Total Impact on Indian Market Outlook &#8211;\u00a0Fiscal &amp; Policy Considerations<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-3'><a class=\"ez-toc-link ez-toc-heading-7\" href=\"https:\/\/carajput.com\/blog\/gst-council-meetings-in-september-and-the-possible-gst-reforms\/#Why_the_Cut_Matters\" title=\"Why the Cut Matters:\">Why the Cut Matters:<\/a><\/li><\/ul><\/li><\/ul><\/nav><\/div>\n<h2><span class=\"ez-toc-section\" id=\"GST_Council_meetings_in_September_and_the_possible_GST_reforms\"><\/span><span style=\"color: #000080;\"><strong>GST Council meetings in September<\/strong> and the possible GST reforms:<\/span><span class=\"ez-toc-section-end\"><\/span><\/h2>\n<p>Prime Minister Narendra Modi on Monday chaired a high-level meeting, which included top Union ministers, secretaries and economists, to deliberate on the roadmap for next-generation reforms, one of the key announcements he had made in his August 15 address\u00a0 Goverment moves ahead with the two-slab GST structure (5% and 18%), it will have multiple short-, medium-, and long-term effects on businesses, consumers, and the economy, Being branded as a \u201cDiwali gift\u201d is meant to resonate with middle-class voters ahead of elections. Over time, it may strengthen GST\u2019s image as a <strong data-start=\"2404\" data-end=\"2429\">\u201cGood and Simple Tax\u201d<\/strong>, fulfilling the original promise<\/p>\n<h3><span class=\"ez-toc-section\" id=\"Proposed_GST_Rate_Changes\"><\/span><span style=\"color: #000080;\"><strong>Proposed GST Rate Changes <\/strong><\/span><span class=\"ez-toc-section-end\"><\/span><\/h3>\n<p><strong>Two-Wheelers (2-W)<\/strong><\/p>\n<ul>\n<li>Current: 28% GST on &lt;350cc bikes\/scooters<\/li>\n<li>Proposed: 18% GST<\/li>\n<li>Direct 10% cut, making scooters, commuter bikes (Splendor, Activa, Pulsar 150 etc.) cheaper by \u20b96,000\u2013\u20b910,000 on-road<\/li>\n<\/ul>\n<p><strong>Small Cars (Below 1200cc Petrol \/ 1500cc Diesel, Under 4m length)<\/strong><\/p>\n<ul>\n<li>Current: 28% + cess (1\u20133%) = ~29\u201331%<\/li>\n<li>Proposed: Flat 18% GST (no cess)<\/li>\n<li>Cars like Maruti Swift, WagonR, Hyundai i10, Tata Tiago, Baleno may get \u20b950,000\u2013\u20b990,000 cheaper.<\/li>\n<\/ul>\n<p><strong>Hybrid Cars (PVs) : <\/strong><\/p>\n<ul>\n<li>Current: 28% + 15% cess = 43%<\/li>\n<li>Proposed: 18% GST<\/li>\n<li>Huge benefit for Toyota Hyryder, Honda City Hybrid, Maruti Grand Vitara Hybrid \u2014 could be \u20b92\u20133 lakh cheaper.<\/li>\n<li>Big Cars, Luxury Cars, SUVs : No change proposed \u2192 will continue under the highest GST + cess bracket (43\u201350%).<\/li>\n<\/ul>\n<h3><span class=\"ez-toc-section\" id=\"In_summary_Current_Tax_Rates_on_Cars_GST_Cess_Total_Tax\"><\/span><span style=\"color: #000080;\"><strong>In summary Current Tax Rates on Cars (GST + Cess = Total Tax %)<\/strong><\/span><span class=\"ez-toc-section-end\"><\/span><\/h3>\n<ul>\n<li>Electric Cars \u2192 5% (no cess) \u2705 lowest<\/li>\n<li>Small Petrol Cars (up to 4m, \u22641,200cc) \u2192 28% + 1% = 29%<\/li>\n<li>Small Diesel Cars (up to 4m, \u22641,500cc) \u2192 28% + 3% = 31%<\/li>\n<li>Cars up to 1,500cc (bigger than small hatchbacks) \u2192 28% + 17% = 45%<\/li>\n<li>Cars above 1,500cc \u2192 28% + 20% = 48%<\/li>\n<li>SUVs (above 4m \/ 1,500cc \/ &gt;170mm ground clearance) \u2192 28% + 22% = 50% \u274c highest<\/li>\n<li>Hybrid Cars (above 4m \/ 1,200cc petrol or 1,500cc diesel) \u2192 28% + 15% = 43%<\/li>\n<\/ul>\n<h3><span class=\"ez-toc-section\" id=\"GST_Council_Meetings_September_2025\"><\/span><span style=\"color: #000080;\"><strong>GST Council Meetings (September 2025)<\/strong><\/span><span class=\"ez-toc-section-end\"><\/span><\/h3>\n<p>Each meeting is expected to be 2 days long. &amp; will likely set the stage for GST 2.0 reforms. The following possible reforms on the table are mentioned here under :<\/p>\n<ol>\n<li><span style=\"color: #000080;\"><strong> 12% Slab to Go <\/strong><\/span><\/li>\n<\/ol>\n<ul>\n<li style=\"list-style-type: none;\">\n<ul>\n<li>GST currently has 5%, 12%, 18%, 28% slabs.<\/li>\n<li>Removing the 12% slab means merging items into 5% or 18% \u2192 simplifies structure.<\/li>\n<\/ul>\n<\/li>\n<\/ul>\n<ol start=\"2\">\n<li><span style=\"color: #000080;\"><strong> GST Rate Rationalisation for Health &amp; Life Insurance<\/strong><\/span><\/li>\n<\/ol>\n<ul>\n<li style=\"list-style-type: none;\">\n<ul>\n<li>Currently taxed at 18% \u2192 makes policies costly.<\/li>\n<li>Likely reduction to 12% or 5% to promote wider adoption.<\/li>\n<\/ul>\n<\/li>\n<\/ul>\n<ol start=\"3\">\n<li><span style=\"color: #000080;\"><strong> Overall Rate Rationalisation of Essential Items<\/strong><\/span><\/li>\n<\/ol>\n<ul>\n<li style=\"list-style-type: none;\">\n<ul>\n<li>Key household essentials may shift to lower GST brackets.<\/li>\n<li>Aim: reduce consumer burden + boost demand.<\/li>\n<\/ul>\n<\/li>\n<\/ul>\n<ol start=\"4\">\n<li><span style=\"color: #000080;\"><strong> Easing Out Blocked Credits<\/strong><\/span><\/li>\n<\/ol>\n<ul>\n<li style=\"list-style-type: none;\">\n<ul>\n<li>Businesses often face ITC (Input Tax Credit) blockages \u2192 impacts cash flow.<\/li>\n<li>Reforms may allow seamless credit flow, improving liquidity for SMEs\/MSMEs<\/li>\n<\/ul>\n<\/li>\n<\/ul>\n<ol start=\"5\">\n<li><span style=\"color: #000080;\"><strong> Clarifications on Pending Classification Issues<\/strong><\/span><\/li>\n<\/ol>\n<ul>\n<li style=\"list-style-type: none;\">\n<ul>\n<li>Many disputes arise on the classification of goods &amp; services (e.g., snacks vs. biscuits, IT services vs. software products). GST Council may issue clear guidelines to avoid litigation. These GST September meetings could be transformational, not just incremental. Main goel is to Simplify the GST structure, cut rates on key sectors (insurance, essentials), boost compliance, and fuel consumption demand. This aligns with PM Modi\u2019s \u201cGST Reforms 2.0\u201d &amp; Double Diwali promise.<\/li>\n<\/ul>\n<\/li>\n<\/ul>\n<h3 data-start=\"2340\" data-end=\"2362\"><span class=\"ez-toc-section\" id=\"Summary_Table\"><\/span><span style=\"color: #000080;\"><strong data-start=\"2345\" data-end=\"2362\">Summary Table<\/strong><\/span><span class=\"ez-toc-section-end\"><\/span><\/h3>\n<div class=\"_tableContainer_sk2ct_1\">\n<div class=\"_tableWrapper_sk2ct_13 group flex w-fit flex-col-reverse\" tabindex=\"-1\">\n<table class=\"w-fit min-w-(--thread-content-width)\" style=\"height: 207px;\" width=\"1058\" data-start=\"2364\" data-end=\"2864\">\n<thead data-start=\"2364\" data-end=\"2396\">\n<tr data-start=\"2364\" data-end=\"2396\">\n<th data-start=\"2364\" data-end=\"2385\" data-col-size=\"sm\">Aspect<\/th>\n<th data-start=\"2385\" data-end=\"2396\" data-col-size=\"md\">Details<\/th>\n<\/tr>\n<\/thead>\n<tbody data-start=\"2430\" data-end=\"2864\">\n<tr data-start=\"2430\" data-end=\"2504\">\n<td data-start=\"2430\" data-end=\"2451\" data-col-size=\"sm\">New GST Slabs<\/td>\n<td data-col-size=\"md\" data-start=\"2451\" data-end=\"2504\">5% (essentials), 18% (standard), 40% (luxury\/sin)<\/td>\n<\/tr>\n<tr data-start=\"2505\" data-end=\"2597\">\n<td data-start=\"2505\" data-end=\"2526\" data-col-size=\"sm\">Items Cheaper<\/td>\n<td data-col-size=\"md\" data-start=\"2526\" data-end=\"2597\">Cement, small cars, ACs, TVs, electronics, packaged food, insurance<\/td>\n<\/tr>\n<tr data-start=\"2598\" data-end=\"2673\">\n<td data-start=\"2598\" data-end=\"2619\" data-col-size=\"sm\">Expected Impact<\/td>\n<td data-col-size=\"md\" data-start=\"2619\" data-end=\"2673\">Higher consumption, stock rally, revenue trade-off<\/td>\n<\/tr>\n<tr data-start=\"2674\" data-end=\"2752\">\n<td data-start=\"2674\" data-end=\"2695\" data-col-size=\"sm\">Beneficiaries<\/td>\n<td data-col-size=\"md\" data-start=\"2695\" data-end=\"2752\">Autos, cement, FMCG, consumer durables, banks, retail<\/td>\n<\/tr>\n<tr data-start=\"2753\" data-end=\"2812\">\n<td data-start=\"2753\" data-end=\"2774\" data-col-size=\"sm\">Price Impact<\/td>\n<td data-col-size=\"md\" data-start=\"2774\" data-end=\"2812\">~7\u20138% reduction in consumer prices<\/td>\n<\/tr>\n<tr data-start=\"2813\" data-end=\"2864\">\n<td data-start=\"2813\" data-end=\"2834\" data-col-size=\"sm\">Timeline<\/td>\n<td data-start=\"2834\" data-end=\"2864\" data-col-size=\"md\">Rollout before Diwali 2025<\/td>\n<\/tr>\n<\/tbody>\n<\/table>\n<\/div>\n<\/div>\n<h3><span class=\"ez-toc-section\" id=\"Total_Impact_on_Indian_Market_Outlook_%E2%80%93_Fiscal_Policy_Considerations\"><\/span><span style=\"color: #000080;\"><strong>Total Impact on Indian Market Outlook &#8211;\u00a0<\/strong><strong data-start=\"1692\" data-end=\"1726\">Fiscal &amp; Policy Considerations<\/strong><\/span><span class=\"ez-toc-section-end\"><\/span><\/h3>\n<ul data-start=\"1727\" data-end=\"1920\">\n<li data-start=\"1727\" data-end=\"1771\">\n<p data-start=\"1729\" data-end=\"1771\">Revenue loss: ~$20 billion annually.\u00a0Offset by higher consumption, stronger compliance, easier administration.\u00a0Requires Centre State coordination (cooperative federalism). S<span style=\"font-size: 16px;\">o\u00a0<\/span>40+ stocks expected to benefit from GST Reforms 2.0 span across auto, cement, FMCG, banking, and consumer durable sectors.<\/p>\n<\/li>\n<li data-start=\"1727\" data-end=\"1771\">\n<p data-start=\"1729\" data-end=\"1771\">Challenges : Companies may not pass full benefit \u2192 instead may boost margins. Rising input costs (steel, semiconductors, logistics) may blunt consumer savings &amp; Short-term revenue strain for Centre &amp; states.<\/p>\n<\/li>\n<\/ul>\n<h3><span class=\"ez-toc-section\" id=\"Why_the_Cut_Matters\"><\/span><span style=\"color: #000080;\"><strong>Why the Cut Matters:<\/strong><\/span><span class=\"ez-toc-section-end\"><\/span><\/h3>\n<ul>\n<li>Currently, small cars (29\u201331%) are taxed almost at luxury levels.<\/li>\n<li>Proposal: Cut small car GST to 18% (from 28%) \u2192 would bring effective rate down to ~18\u201319% (vs 29\u201331% now).<\/li>\n<li>This could make entry-level hatchbacks &amp; compact sedans 10\u201312% cheaper, boosting demand amid weak sales.<\/li>\n<li>Game changer for mass-market 2-W &amp; small cars \u2192 boosts middle-class affordability.<\/li>\n<li>Hybrid push \u2192 aligns with India\u2019s green mobility agenda, making hybrids far more attractive.<\/li>\n<li>Luxury\/SUVs stay expensive \u2192 protects govt revenue &amp; avoids giving tax relief to premium buyers.<\/li>\n<li>Festive-season demand boost expected if proposals are cleared by early October GST Council meet.<\/li>\n<li>Auto &amp; Two-Wheelers (lower GST on small cars &amp; 2-wheelers) like Maruti Suzuki, Tata Motors, Mahindra &amp; Mahindra, Hero MotoCorp, Bajaj Auto, TVS Motor<\/li>\n<li>Cement (rate cut from 28% \u2192 18%) like UltraTech Cement, Shree Cement, ACC, Ambuja Cements, Dalmia Bharat, Ramco Cement<\/li>\n<li>FMCG (reduced GST on packaged food &amp; essentials) : like Hindustan Unilever (HUL), ITC, Nestl\u00e9 , ndia, Dabur, Britannia, Marico, Colgate-Palmolive<\/li>\n<li>Consumer Durables (ACs, TVs, electronics moving to lower slab) like Voltas, Blue Star, Whirlpool, Havells, Crompton Greaves, Dixon Technologies.<\/li>\n<li>Banking &amp; Financials (consumption-led credit growth) like HDFC Bank, ICICI Bank, SBI, Axis Bank, Kotak Mahindra Bank, Bajaj Finance.<\/li>\n<li>Retail &amp; E-commerce like Avenue Supermarts (DMart), Trent, Aditya Birla Fashion &amp; Retail,<\/li>\n<li>Analysts expect higher consumption demand post-reforms, boosting volumes for autos, cement, FMCG, and consumer goods. Banks &amp; NBFCs stand to gain from increased retail lending. The move is seen as a short-term consumption booster and a medium-term tax simplification reform.<\/li>\n<\/ul>\n<ul>\n<li style=\"list-style-type: none;\">\n<ul>\n<li>In short: Short-term = consumption boom + market rally,<\/li>\n<li>Medium-term = tax simplification, and<\/li>\n<li>Long-term = compliance &amp; growth if revenue gap managed well.<\/li>\n<\/ul>\n<\/li>\n<\/ul>\n","protected":false},"excerpt":{"rendered":"<p>GST Council meetings in September and the possible GST reforms: Prime Minister Narendra Modi on Monday chaired a high-level meeting, which included top Union ministers, secretaries and economists, to deliberate on the roadmap for next-generation reforms, one of the key announcements he had made in his August 15 address\u00a0 Goverment moves ahead with the two-slab &hellip;<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[1],"tags":[6216],"aioseo_notices":[],"_links":{"self":[{"href":"https:\/\/carajput.com\/blog\/wp-json\/wp\/v2\/posts\/29706"}],"collection":[{"href":"https:\/\/carajput.com\/blog\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/carajput.com\/blog\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/carajput.com\/blog\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/carajput.com\/blog\/wp-json\/wp\/v2\/comments?post=29706"}],"version-history":[{"count":2,"href":"https:\/\/carajput.com\/blog\/wp-json\/wp\/v2\/posts\/29706\/revisions"}],"predecessor-version":[{"id":29708,"href":"https:\/\/carajput.com\/blog\/wp-json\/wp\/v2\/posts\/29706\/revisions\/29708"}],"wp:attachment":[{"href":"https:\/\/carajput.com\/blog\/wp-json\/wp\/v2\/media?parent=29706"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/carajput.com\/blog\/wp-json\/wp\/v2\/categories?post=29706"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/carajput.com\/blog\/wp-json\/wp\/v2\/tags?post=29706"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}