The new GST reform implemented in 2025 has brought significant relief to the general public by rationalizing the tax structure on daily essentials. This reform has cut down GST slabs from four to two: basic rates at 5% and 18%, and an additional slab at 40% for luxury/sin goods. Hence, the simplification meant a major benefit for daily essentials because GST rates on many basic items have gone down, making them more affordable for households across India.
Key Changes in GST Slabs for Daily Essentials
- Items such as hair oil, toilet soap, shampoo, toothbrushes, toothpaste, and other hygiene products moved from 18% GST to 5% GST.
- Milk products such as ultra-high temperature (UHT) milk, chena, paneer, and several Indian breads (roti, chapati, paratha) have no GST (0%).
- Food items such as butter, ghee, cheese, namkeen, bhujia, sauces, pasta, instant noodles, chocolates, coffee, and canned meat experienced a reduction in GST to 5% from 12% or 18%.
- Household goods such as bicycles, tableware, kitchenware, crockery, and furniture made from bamboo saw their GST reduced from a higher slab to 5%.
This rationalization will reduce the financial burden on households, raise consumption patterns, and further simplify tax compliance.
Benefits to the General Public
- Reduced tax rates will directly reduce the prices on day-to-day items and will directly improve household budgets.
- Consumers now enjoy a more affordable means of personal hygiene and food staples, and affordability of grocery essentials.
- Lower GST rates across key products will help increase demand, particularly in rural areas, increasing accessibility.
- This reform frees up disposable income, helping middle-class and low-income families manage expenses better.
- Businesses, especially small and medium enterprises in the FMCG sector, benefit from simplified compliance and potentially higher sales volumes.
Old GST Rate vs New GST Rate on Daily Essentials
| Item Category | Old GST Rate | New GST Rate | Benefit to Public |
| Hair Oil, Shampoo, Soap | 18% | 5% | Cheaper personal care products for everyday use |
| Toothbrushes & Toothpaste | 18% | 5% | Affordable oral hygiene essentials |
| Milk (UHT), Chena, Paneer | 5% | 0% | Essential dairy brought to zero tax, lowering prices |
| Indian Breads (Roti, Chapati) | 5% | 0% | Staple diet items tax-free, aiding family budgets |
| Butter, Ghee, Cheese | 12% | 5% | Reduced cost on kitchen staples |
| Namkeen, Bhujia, Sauces, Pasta | 12%-18% | 5% | Affordable snacks and cooking essentials |
| Bicycles | 12%-18% | 5% | Promotes eco-friendly transport options at lower cost |
| Kitchenware, Tableware | 12% | 5% | Lower cost on household items |
This new GST slab structure signifies a major reform aimed at making daily essentials more affordable and easing inflationary pressures on the common man, ultimately enhancing the quality of life for millions across India.
