New GST Rates: From mobile to AC, how much have they become cheaper after the reduction in GST rates, see the full list..
GST Reform India 2025: The Goods and Services Tax (GST), implemented in the country in 2017, has now undergone major reforms after eight years. In the GST Council meeting held on Wednesday, the government took a big decision to simplify the tax structure. Now there will be only two tax slabs, 5% and 18%, in the entire system. The earlier 12% and 28% slabs have been removed. At the same time, a 40% tax will remain applicable on certain products like luxury cars and SUVs. That is, they will remain expensive. These new rates are going to be implemented from 22 September 2025.
Effect of change in GST rate
The tax structure has become simpler due to GST reforms, and many essential goods will now come within the reach of the people. The government's objective behind this decision is that more and more people can take advantage of modern facilities. Especially before the festivals, this change seems to be good news for the middle class. Because with this change, the general public is going to get a big relief, especially on electronic goods and everyday things.
Let us understand in detail how much tax will have to be paid on which things and what will be its effect on your pocket.
GST on Mobile Phones
Now, 18% GST will be levied on all mobile phones. Earlier this rate was 12%. This simply means that mobile phones will now be a little expensive. For example, if the price of a mobile is ₹ 20,000, then earlier at 12% GST, you had to pay ₹ 2,400 tax on it. Now, at 18% you will have to pay ₹ 3,600 tax.
GST on Cars (Car GST Rates)
Ordinary cars (hatchback/sedan): Now, 18% GST will be applicable on these. Earlier, 28% had to be paid, which will give great relief to the buyers.
SUVs and luxury cars: The total tax on these will be up to 40%. That is, the tax on vehicles of this segment will still be high.
Electric cars (EVs): 12% GST will be applicable on these. This rate was 12% earlier, which means there will be no change in the price of electric cars even after the new GST rates.
GST on Gold
The tax rate on gold will remain the same. 3% GST will be applicable on jewellery, decorative items, and other gold products. That is, if the price of jewellery is Rs 1 lakh, then you will have to pay ₹ 3,000 tax on it.
GST on Electronic Items
The biggest relief has been received here. Earlier, 28% GST was levied on products like TV, fridge, washing machine, dishwasher, and AC. Now, only 18% GST will be levied on all these. This means that these products will now become much cheaper than before.
GST on Apparel
Clothes priced up to ₹ 1,000: Now 5% GST will be applicable on these. The same rate applied to them earlier also. Clothes costing more than ₹1,000: Now 18% GST will have to be paid on these, whereas earlier there was 12% GST on these. That means premium and branded clothes will become expensive.
How much will be the savings on AC now with the new GST rate?
The most discussed topic among people is the prices of AC. Due to the reduction in GST on this, many people will now be able to think about buying it. Let us understand how much you will save with the new GST rates on AC through an example.
Suppose the base price of an AC is ₹35,000. Earlier, when a 28% GST was imposed, its total price became ₹44,800. That means you used to pay ₹9,800 only as tax.
Now, according to 18% GST, the same AC will be available for ₹41,300. That means the customer will have a direct saving of about ₹3,500. If the price of an AC is slightly less or more, then the difference in savings can be around ₹ 3,000 to ₹ 5,000.
Big relief to the middle class and common people
This decision of the government is going to give relief to the middle class and common households. Electronic goods like AC, TV, fridge, and washing machine will now become cheaper than before. Those who buy these goods during the festive season will get direct benefit from this. However, due to increase in tax on products like premium clothes and mobile phones, these may become a bit expensive. At the same time, luxury cars will still remain expensive.
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