India’s Goods and services Tax (GST) system has entered a new era with GST 2.0, effective September 22, 2025. The overhaul simplifies taxation, reduces rates on essential goods, and is expected to make items like ACs, refrigerators, and TVs more affordable. Here’s everything you need to know:

1. GST 2.0 Simplifies the Tax Structure

Under GST 2.0, the Council has streamlined tax slabs into three main categories:

• 5%: Essentials and everyday items
• 18%: Standard goods, including most household and consumer products
• 40%: Luxury items, automobiles, and sin goods

This replacement of complex old categories makes GST easier to understand and apply.

2. Consumer Electronics Get Relief

Several household electronics are seeing reduced GST rates, making them cheaper for buyers:

• Air Conditioners – Reduced from higher GST slabs to standard 18%
• Refrigerators – Tax cut lowers overall purchase price
• Televisions – Especially large-screen and smart TVs now more affordable

This reduction is expected to boost festive season sales and make electronics accessible to a wider audience.

3. Why Prices Are Dropping

The simplification and rate reduction mean:

• Manufacturers can adjust retail prices downward
• Consumers benefit immediately on purchases
• Competition among brands may further lower prices during festive sales

4. Impact on Other Household Goods

Besides electronics, GST 2.0 also affects:

• Kitchen appliances: Mixers, microwaves, and water purifiers
• Personal care devices: Hairdryers, trimmers, and grooming tools
• Small furniture and home essentials

Overall, household shopping becomes more cost-effective for indian consumers.

5. business and Retail Implications

Retailers and manufacturers must:

• Update billing and accounting systems to reflect new rates
• Communicate price changes clearly to customers
• Prepare for increased demand during festive and diwali sales

6. Benefits for Consumers

• Immediate savings on high-ticket electronics
• Encouragement to upgrade household appliances
• Reduction in overall GST-related confusion while shopping

7. Looking Ahead

GST 2.0 aims to simplify taxation, increase compliance, and reduce costs for everyday buyers. The rollout during the festive season ensures that consumers can enjoy savings on both essentials and big-ticket items.

Disclaimer:

The views and opinions expressed in this article are those of the author and do not necessarily reflect the official policy or position of any agency, organization, employer, or company. All information provided is for general informational purposes only. While every effort has been made to ensure accuracy, we make no representations or warranties of any kind, express or implied, about the completeness, reliability, or suitability of the information contained herein. Readers are advised to verify facts and seek professional advice where necessary. Any reliance placed on such information is strictly at the reader’s own risk.