Key highlights from the new GST slabs include reductions from 18% to 5% on hotel bookings (rooms Rs.1,000-Rs.7,500), gym memberships, beauty services, and cinema tickets up to Rs.100 (previously 12%). Flight tickets and premium hotel rooms above Rs.7,500 retain 18% GST, while rooms under Rs.1,000 remain tax-free. Kitchen staples such as paneer and ghee see significant price drops, with estimated MRPs reflecting the savings though actual market prices may be lower due to discounts.
Automobiles also benefit: Petrol cars over 1,200cc and longer than 4 meters, diesel variants over 1,500cc, and motorcycles above 350cc now fall under a 40% slab, down from up to 45% (28% GST + cess). However, luxury items like pan masala and tobacco face a new 40% tax, potentially increasing costs.
Finance Minister Nirmala Sitharaman, speaking at the 'Next Gen GST Reforms' event in Visakhapatnam, hailed the changes as "GST 2.0," projecting an influx of Rs.2 lakh crore into the economy. Chief Economic Advisor V Anantha Nageswaran emphasized boosted purchasing power, fueling demand and GDP growth. Economist Garima Kapoor from Elara Capital predicts a 1%-1.2% consumption surge, enhancing growth over the next 4-6 quarters.
The government warns against profiteering, with tax departments planning surprise inspections. Old stock will also reflect lower prices, ensuring widespread benefits.
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