GST Utsav 2025: Essentials Cheaper, Luxury Goods Costlier – Live Updat

Introduction

The Indian government has introduced GST Reform 2.0, the biggest update since 2017. The new system simplifies GST rates in India and makes daily essentials cheaper, while keeping luxury and “sin” goods costlier. This change aims to boost demand, reduce household expenses, and strengthen MSMEs.

To celebrate these reforms, Prime Minister Narendra Modi announced the launch of GST Utsav 2025 (GST Bachat Utsav) on 22nd September, 2025, coinciding with Navratri. This festival highlights the savings people will enjoy due to reduced GST on essentials.

What is GST Utsav?

GST Utsav or GST Bachat Utsav is a nationwide initiative linked with the launch of GST 2.0. It is designed to

• Pass on the benefit of lower GST to consumers.
• Highlight how essentials are now cheaper.
• Boost the spirit of “Make in India” and Aatmanirbhar Bharat.
  
  Prime Minister Modi said this is a “festival of savings” for the poor and middle class, as their daily spending on food, medicines, and essentials will now reduce.

GST Utsav 2025: Next Generation GST Reform & Bachat Utsav

Prime Minister Narendra Modi described the new tax system as a “Next Generation GST Reform” and a “GST Bachat Utsav”. Starting on 21st September 2025 with Navratri, he called it a festival of savings for the poor, neo-middle class, and middle class. According to him, the new GST dare (GST rates) are not just numbers, but a tool to lower household expenses and empower small businesses.

He also referred to it as an “Azaad Bharat Tax Reform”, since the old complex slabs have now been simplified into two main rates — 5% and 18%, plus 40% for luxury and sin goods. This makes compliance easier and helps MSMEs, startups, and small traders focus more on growth rather than paperwork.

Swadeshi Bharat & Aatmanirbhar Bharat Through GST Reforms

PM Modi urged citizens to prefer local products under the Swadeshi Bharat and Make in India campaigns. He said every Indian-made item represents the hard work of our people and contributes to building an Aatmanirbhar Bharat abhiyan. For MSMEs, this reform means lower production costs, cheaper transport, and better export opportunities, leading to stronger domestic demand and global competitiveness.

He also pointed out that under GST Utsav, even travel and hospitality become more affordable. Hotel stays, food, and transport that earlier had higher taxes are now cheaper, giving relief to families and boosting India’s tourism sector.

Simplified GST Slabs

Earlier, Indian GST rates had four slabs: 5%, 12%, 18%, and 28%. Under GST Reform 2.0, the structure is simplified:

• 5% slab – for essentials like food, textiles, and farming goods.
• 18% slab – for most consumer products and services.
• 40% slab – for luxury and sin goods like SUVs, tobacco, and sugary drinks.
  
  This makes it easier to understand how much is GST tax in India and brings transparency in the GST percentage in India.

GST Utsav and Navratri: Why It Matters

Starting the GST Utsav with Navratri is symbolic. Festivals are the time when families spend more on food, clothes, electronics, and vehicles. Lower GST rates mean:

• Households save more on essentials during festive shopping.
• Middle-class families can buy bigger items like ACs, TVs, or bikes at reduced tax.
• Farmers get cheaper fertilizers and tools, boosting rural demand.
  
  This timing ensures people experience real savings right at the beginning of the festive season.

GST Utsav and Online Sales – Amazon, Flipkart, Big Billion Days

From 22nd September 2025, the GST reforms came into effect, and coincidentally, Amazon Great Indian Festival and Flipkart Big Billion Days also started.

This means double benefit for buyers:

• Mobile phones & laptops– earlier taxed at 18–28%, now many at 18% only.
• Bikes & cars – small vehicles moved from 28% → 18%, mid-segment cars up to 13% cheaper.
• Electronics like TVs, ACs, dishwashers – GST reduced from 28% → 18%.

So festive discounts + GST rate cuts = maximum savings for consumers.

New GST Rates 2025

GST Utsav 2025: How MSMEs Benefit

The GST Bachat Utsav is not only about cheaper essentials for consumers but also a big boost for MSMEs (Micro, Small & Medium Enterprises). With reduced tax rates, simplified rules, and lower costs, MSMEs stand to gain a double advantage lower expenses and higher sales.

Key Benefits for MSMEs

• Increase in Sales → Lower GST rates make goods more affordable for consumers, which boosts demand and helps MSMEs sell more.
• Reduced Costs and Taxes → Many raw materials and essential inputs now attract lower GST, reducing production costs and improving margins.
• Simplified GST Compliance → With only two main slabs (5% and 18%), tax compliance becomes much easier, saving MSMEs time and effort.
• More Business and Investments → A simpler system and favorable environment encourage growth, helping MSMEs attract more investments.
• Boost to Aatmanirbhar Bharat → Local and indigenous products get more support, allowing MSMEs to scale up production and compete globally.
• Ease and Savings → Small traders and entrepreneurs can now manage their businesses more easily, save part of their income, and reinvest in growth.

Prime Minister Modi’s Key Message

PM Modi described GST Utsav as “a festival of savings for every Indian family.” He said that:

• Essentials like food, dairy, and medicines becoming cheaper will help the poor.
• Middle-class families will save more during Navratri and festive shopping.
• GST 2.0 reforms will strengthen domestic manufacturing, MSMEs, and farmers.

Impact on Common Man

The new GST rates 2025 reduce the cost of food, health, insurance, farming equipment, and daily household products. This increases savings and raises disposable income for middle-class families.

Impact on Businesses & MSMEs

MSMEs benefit from lower input costs (like textiles, fertilizers, cement). Reduced GST percentage in India means better margins, improved competitiveness, and more opportunities for “Make in India” businesses.

Conclusion

The new GST rates 2025 mark a major step in simplifying taxation. Essentials are cheaper, MSMEs get stronger, and India’s growth story continues. With GST Reform 2.0, the government balances affordability for the poor and middle class while keeping luxury goods heavily taxed. This shift in GST rates in India makes the tax system simpler, fairer, and growth-oriented.

FAQ

1. What is GST Utsav 2025?

GST Utsav, also called GST Bachat Utsav, is a nationwide savings festival announced by Prime Minister Narendra Modi. It started with the launch of GST Reform 2.0 and highlights how lower GST rates make essentials cheaper and support small businesses.

2. When did GST Utsav come into effect?

GST Utsav came into effect on 22nd September 2025, the first day of Navratri. This timing was chosen to give people direct savings during the festive season when household and business spending is at its peak.

3. What is the new GST rate 2025?
The new GST rate 2025 is simplified into three main slabs – 5% for essentials, 18% for most goods and services, and 40% for luxury & sin goods. Some items like paneer, milk, bread, and insurance are now 0% GST.

4. How has GST changed for automobiles and electronics?

• Small cars, bikes, scooters → GST cut from 28% to 18%.
• Mid-segment cars → up to 13% cheaper.
• Electronics like TVs, ACs, dishwashers → reduced from 28% to 18%.

5. What are the GST rates for health and insurance?

• Medicines & medical devices → 0–5%.
• Health & life insurance premiums → 0% (no GST).
• This makes treatment and policies more affordable.
  

6. Which business sectors benefit the most from the new GST rates?

The sectors that benefit most include:

• MSMEs (lower input costs and simpler compliance).
• Textiles (yarn and fabrics reduced to 5%).
• Agriculture (fertilizers, tractors, farm machinery now at 5%).
• Healthcare (medicines and insurance made cheaper).
• Electronics & Automobiles (GST reduced from 28% to 18%).

7. How does GST Utsav help the common man and MSMEs?

For the common man, essentials like milk, bread, paneer, medicines, and small vehicles are now cheaper. For MSMEs, costs have gone down, compliance is simpler, and demand for their products will increase creating a double benefit of savings and growth.