ACs to cars: Full list of what gets cheaper as new GST rates kick in
GST rate cut: India's biggest tax revamp since 2017 takes effect from today, September 22. Here's everything that changes as GST slabs are reduced from 4 to two
The new GST rates come into effect from Monday, a move that Prime Minister Narendra Modi said, along with earlier income tax changes, will help Indians save nearly ₹2.5 lakh crore.
Describing the relief measures as a “savings festival,” Modi said the income tax cuts have largely benefitted the middle class, while the GST revisions extend benefits to the poor and the neo middle class as well.
“With these reforms, people will be able to save more and spend on what they wish. From youth, farmers and women to shopkeepers, traders and entrepreneurs—everyone will gain from this Bachat Utsav. This festive season, every family will have something to celebrate,” he said in an address to the nation on Sunday evening.
Here is a full list of items that will get cheaper:
Home appliances and electronics
Air conditioners: Expect savings of ₹2,800 to ₹5,900 on split ACs, with window units seeing reductions of around ₹3,400. Commercial air conditioning systems for offices and large buildings also get cheaper.
Dishwashers: Price cuts of up to ₹8,000, with entry-level models dropping by approximately ₹4,000. This niche segment could see expanded adoption as costs become more accessible.
Large televisions: Models above 32 inches to see reductions ranging from ₹2,500 to ₹85,000 depending on the screen size. Entry-level 43-inch models drop by ₹2,500-5,000, mid-range 55-65 inch TVs see cuts of ₹3,400-20,000, while premium TVs with displays of 100 inches would see massive reductions of ₹85,800.
Daily essentials and personal care
Bathroom essentials: Hair oil, toilet soaps, shampoos, toothbrushes and toothpaste all move to the 5% tax bracket, making daily hygiene more affordable.
Grooming products: Talcum powder, face powder, shaving cream and after-shave lotions see significant reductions as taxes drop from 18% to 5%.
Baby products: Diapers and feeding essentials become cheaper, providing relief to young families.
Food and Kitchen Staples
Dairy products:Ghee sees price cuts between ₹40-70 per litre (bringing 1-litre packs down to ₹610-750), while butter price drops by ₹4 per 100g pack to ₹58. Paneer also becomes ₹4 cheaper per 200g pack at ₹95.
Packaged foods: Namkeen and bhujia, instant noodles ( ₹4 reduction to ₹116), chocolates (premium spreads down ₹50, luxury boxes down ₹100), jams, ketchup and sauces all get cheaper as they move to the 5% bracket.
Beverages: Fruit juices see ₹5-10 reductions (apple juice down to ₹105, mango drinks to ₹65), coffee blends drop ₹30-95 per pack, and bottled water becomes ₹2 cheaper, though aerated drinks remain in the higher tax category.
Completely tax-free: Ultra-high temperature milk, prepackaged paneer and all Indian breads including chapati, roti and parantha become completely exempt from GST.
Health care and Wellness
Medicines: Thirty-three lifesaving drugs become completely tax-free, whilst three cancer and rare disease medications also lose their tax burden. All other medicines move from 12% to 5%.
Medical equipment: Glucometers, diagnostic kits, surgical equipment and medical devices become more affordable for patients and health care providers.
Wellness services: Gym memberships, salon services, barber visits, yoga classes and spa treatments drop from 18% to 5%, though businesses lose input tax credit benefits.
Automobiles and Transport
Small vehicles: Vehicles and motorcycles with engines up to 350cc see tax reductions from 28% to 18%, making entry-level mobility more accessible.
Entry-level cars: Mass-market hatchbacks see substantial cuts: popular budget models drop ₹40,000-75,000, mid-range sedans see ₹57,000-80,000 reductions, and compact SUVs become ₹68,000-85,000 cheaper.
Mid-range vehicles: Family cars and SUVs see bigger savings — mainstream SUVs drop between ₹1.01-1.56 lakh, popular sedans become ₹60,000-98,000 cheaper, and crossover models see ₹72,000-1.23 lakh cuts.
Premium vehicles: Luxury SUVs witness dramatic reductions ranging from ₹1.8 lakh to ₹4.48 lakh, while ultra-premium models see cuts exceeding ₹30 lakh in some cases.
Two-wheelers: Scooters and motorcycles under 350cc (covering 98% of India’s two-wheeler market) become ₹5,600-18,800 cheaper. Popular commuter scooters see ₹7,000-8,200 cuts while performance motorcycles drop ₹13,000-18,800.
Commercial vehicles: Buses, trucks and ambulances become cheaper, potentially reducing transportation costs across the economy.
Auto parts: All automobile components now attract a uniform 18% rate regardless of classification, simplifying the supply chain.
Construction and Agriculture
Building materials:Cement prices drop as GST falls from 28% to 18%, providing relief to home builders and infra projects.
Farming equipment: Tractors, harvesters, soil preparation machinery and other agricultural tools become more affordable.
Fertiliser components: Raw materials for fertiliser production see rate cuts, potentially reducing farming input costs.
Hospitality Services
Hotel rooms: Those priced at ₹7,500 or below per night see taxes drop from 12% to 5%.
Student use items
Completely tax-free: Exercise books, erasers, pencils, crayons and sharpeners move to tax-free slab. Geometry boxes, school cartons, and trays move from the 12% bracket to 5%.
Insurance relief
Complete exemption: Both life insurance policies (term, ULIP, endowment) and health insurance (including family floaters and senior citizen plans) become completely tax-free, delivering substantial savings to policyholders.
