GST 2.0 Coming This Diwali: PM Modi Unveils Major Tax Overhaul with Simpler 2-Slab Structure

gst reforms

In a landmark announcement during his Independence Day speech, Prime Minister Narendra Modi revealed that the next phase of Goods and Services Tax (GST) reforms will roll out by Diwali. The centerpiece of this reform is a simplified two-rate tax structure aimed at reducing the financial burden on small businesses and everyday consumers.

Moving away from the current multi-slab system, the Finance Ministry has proposed a dual-rate model — consisting of a standard and a merit slab — while maintaining special rates for a few essential items.

Labeling the reform as a “game-changer,” the Finance Ministry emphasized that the revamped GST regime will be built on three key pillars: structural transformation, rate rationalisation, and improved ease of living.

The proposal has been submitted to the GST Council’s Group of Ministers (GoM) for final deliberation. If approved, this could mark one of the biggest tax reforms since GST’s inception in 2017, aiming to make the system more efficient, equitable, and business-friendly.


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