FinMin proposes 2-tier GST structure, special rates on select items; Council meet likely in Sept
GST
Dated:- 15-8-2025
PTI
New Delhi, Aug 15 (PTI) The finance ministry on Friday said it has proposed a two-slab GST rate structure to the Group of Ministers (GoM), along with special rates for select few items, as the government looks to unveil “next generation” GST reforms in the current financial year which will lower tax burden on daily use items.
The Centre has proposed to a panel of state finance ministers that the Goods and Services tax (GST) regime should have just two slabs where goods and services can be classified as 'standard' and 'merit'. Also, special rates can be levied on select items which will be specified.
Curr
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eting will deliberate on the recommendations of GoM, and every effort will be made to facilitate early implementation so that the intended benefits are substantially realised within the current financial year,” the finance ministry said while unveiling its proposal which has been submitted to the rate rationalisation GoM.
Prime Minister Narendra Modi in his address to the nation on 79th Independence Day announced that 'next generation' GST reforms which will lower tax burden substantially and benefit small industries is in the works and the lower taxes will be a Diwali gift to citizens.
Soon after the announcement, the finance ministry said the Centre has shared its proposal on GST to the GoM which rests on three pillars structural ref
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icy direction to build industry confidence and support better business planning”.
On the 'ease of living' side, the finance ministry's proposal include seamless, technology driven GST registration, especially for small businesses and startups. It also suggested implementation of pre-filled GST returns and faster and automated processing of refunds for exporters and those with inverted duty structure.
The ministry said the end of compensation cess has created fiscal space, providing greater flexibility to rationalise and align tax rates within the GST framework for long-term sustainability.
The ministry said in the true spirit of cooperative federalism, the Centre remains committed to working closely with the states.
“It will be buil
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