Sitharaman said GST Council’s decision lowers household tax burden and boosts liquidity in the overall economy
Visakhapatnam
Finance Minister Nirmala Sitharaman announced on Wednesday that the latest GST 2.0 reforms will save Indian consumers nearly Rs 2 lakh crore, putting more disposable income in the hands of the people for savings and spending.
Speaking at the Outreach and Interaction Programme on Next Gen GST Reforms, Sitharaman said the decision of the GST Council will reduce the tax burden on households while improving liquidity in the economy. She stressed that 99 per cent of goods now fall under the 5 per cent GST slab, benefiting especially the middle class and poor families.
The new system shifts to two slabs — 5 per cent and 18 per cent — eliminating the previous 12 per cent and 28 per cent rates. According to the Finance Minister, this simplification has lowered taxes, made the system more transparent, and easier for businesses and consumers to follow.
The reforms are expected to boost farmers’ incomes by cutting taxes on agriculture-related goods, thus supporting farm modernisation. Small businesses and job-creating industries will also gain from reduced costs, creating fresh opportunities.
Sitharaman noted GST collections have jumped from Rs 7.19 lakh crore in 2018 to Rs 22.08 lakh crore in 2025. The number of registered taxpayers has more than doubled to 1.51 crore, compared to 65 lakh earlier, showing stronger compliance.
She said the reforms reflect Prime Minister Narendra Modi’s vision of Viksit Bharat and Atmanirbhar Bharat. Effective September 22, the new tax regime is expected to strengthen India’s economy while empowering citizens through higher purchasing power.
