GST 2025: Easy Guide to New Rates and Slab Changes Chart!

From 22 September 2025, India’s Goods & Services Tax (GST) structure has been substantially overhauled. The government reduced complexity, reclassified many items, made essentials cheaper, and imposed higher taxes on luxury or “sin goods”. This article shows the changes by item, with comparison charts, and explains what this means for consumers.

What’s New in GST 2025

Before diving into goods & rates, here are the headline changes:

• Two main slabs: 5% and 18% for most goods and services.

• Essentials moved to 0% (nil GST).

• Luxury or sin goods subject to a special high slab of 40%.

• The older slabs of 12% and 28% are mostly eliminated (or reallocated).

Chart: Selected Goods — Old Rate vs New Rate

Below is a comparison chart for many goods, showing the old GST slab(s), the new slab, and whether the change makes them cheaper or costlier.

Legend: Cheaper = you’ll pay less GST or none; More expensive = rate increased, taxed heavier.

Chart: Proportion & Shift of Goods from Old Slabs

Here’s an approximate view of how many items moved from old slabs into the new ones, based on sectors / categories.

What “Sin Goods” Are & What’s in the 40% Slab

“Sin goods” are goods considered harmful to health or society. Under GST 2025, they attract the 40% slab. Here’s what this includes:

• Aerated / carbonated / sugary drinks; caffeinated beverages.

• Motor vehicles (cars / SUVs) with high engine capacity, motorcycles above 350 cc.

• Luxury items: yachts, private aircraft, leisure boats.

• Tobacco, pan masala, gutkha, etc. (though some continue under old rates + cess until formal transition).

Deep Dive: What Moves to Which Slab + Why

Let’s go through more items in detail, what they were, where they are now, and key rationale.

Essentials & Food Items

• What changed: Many food items that had 12‑18% GST (e.g. biscuits, snacks, sauces, pastas, dry fruits) are now in 5% slab.

• Zero‑rated: Indian breads, UHT milk, paneer etc. are now nil GST.

• Why: To control living cost, especially for middle & lower income families; reduce inflationary pressure. Ensuring food staples are more affordable.

Personal Care & Household Items

• Items like soap, shampoo, hair oil, toothbrushes moved from 18% to 5%.

• Other home‑use goods (utensils, non‑electric kitchenware, water filters etc.) also benefit.

Big Ticket / Durable Goods, Automobiles & Housing

• Appliances & electronics: Televisions, ACs, fridges etc. move from higher rates (28%) to 18%. Cheaper for buyers.

• Small cars, motorcycles under certain cc thresholds → 18% instead of 28%. Reduces cost of ownership for many.

• Construction materials like cement drop to 18%. Helpful for real estate, infrastructure.

Luxury & Sin Goods

• These goods are not made cheaper; many are made more expensive via 40% slab.

• Affected goods: sugary / fizzy beverages; high CC vehicles; yachts; tobacco etc.

Implications & What Consumers Should Expect

Putting all these changes together, what do these mean in practice?

1. Cost Savings on Everyday Purchases
   For groceries and daily essentials: households will see noticeably lower GST components. If an item was taxed at 12‑18%, moving to 5% or 0% means savings.

2. Big Purchases Get Cheaper
   Buying electronics or vehicles will be more affordable, especially smaller cars, household appliances.

3. Luxury / Sin Goods Costlier
   If you buy sugary drinks, premium cars, etc., you will be paying considerably more under the 40% slab.

4. Inflation Relief
   These changes are intended to pull down inflation of essential goods.

5. Complex Jurisdiction / Transition Effects
   Some items may still carry old GST + cess till obligations (like compensation cess) are cleared. Also, the cost drop might not pass fully to consumers immediately (logistics, retailer markup etc.).

Full-ish Itemised List (Grouped by Slab)

To help you see more clearly, here is a grouped list of many items under each new slab, based on available sources. This is not fully exhaustive, but covers many commonly used goods.

Why These Changes?

Summarising the rationale helps make sense of the shifts:

• Simplicity: Earlier many slabs (5, 12, 18, 28) made classification tricky; disputes & compliance burdens were high. Simplifying to mostly 5% and 18% + special 40% for luxury/sin goods reduces complexity.

• Relief for Common Consumers: Essential goods and daily use items are cheaper. Helps reduce cost of living.

• Encouragement of Domestic Demand: Lower taxes on appliances, vehicles etc. to boost consumer demand.

• Public Health & Progressive Taxation: High rates on “sin” or harmful items discourage consumption and help raise revenue from those who can pay more.

Possible Challenges / Things to Watch

• Not all goods transition immediately. Some sin goods may stay under old GST + compensation cess until legal or fiscal obligations are resolved.

• Retailers, wholesalers need to update billing, inventory, pricing — transitional delays may cause inconsistent price changes.

• In some cases, only the GST component is reduced; other costs (transport, logistics, etc.) remain, so final consumer price may not fall by full theoretical margin.

• Consumer expectations might overshoot; while many prices drop, some may only reduce marginally.

Conclusion

The GST Reforms of 2025 mark one of the most sweeping tax‑changes in recent memory in India. With the introduction of the simpler slab structure (0%, 5%, 18%, 40%), the government aims to lighten the load on everyday essentials, stimulate consumption and demand, while ensuring luxury/sin goods carry a heavier burden.

From 22 September 2025, you’ll see many daily goods (food, dairy, personal care) becoming noticeably cheaper, big appliances & vehicles more affordable (if not premium/high engine ones), and sin / luxury products becoming more expensive.