NEW DELHI: The 56th meeting of the Goods and Services Tax (GST) Council, chaired by Finance Minister Nirmala Sitharaman, will be held on September 3–4 to decide on the Group of Ministers’ (GoM) proposal for a simplified two-slab GST structure of 5 per cent and 18 per cent.
Currently, India follows a four-slab GST system — 5 per cent, 12 per cent, 18 per cent and 28 per cent — along with an additional cess on sin and luxury goods.
Under the proposed structure, ‘merit’ goods and services will attract 5 per cent GST, while most other items will fall under the 18 per cent standard rate.
A higher 40 per cent levy will continue to apply to a limited set of “sin goods” such as alcohol, tobacco, drugs, gambling, soft drinks, fast food, coffee and sugar. The purpose of the sin tax is to discourage consumption of these products and reduce associated harm.
According to an official statement, the meeting comes amid the Centre’s major push to streamline the GST regime by reducing the number of slabs from four to two.
Bihar Deputy Chief Minister Samrat Choudhary, who heads the six-member GoM, said, “We have recommended a two-slab GST structure and have submitted our recommendations to the GST Council.”
The GoM proposed scrapping the existing 12 per cent and 28 per cent slabs. Nearly 99 per cent of items in the 12 per cent category would move to 5 per cent, while about 90 per cent of items taxed at 28 per cent would shift to 18 per cent.
Consumer goods in the 28 per cent slab are also proposed to be moved to 18 per cent, while a new 40 per cent slab would be introduced for sin goods such as tobacco and pan masala.
An official memorandum issued by Arvind Shrivastava, Secretary to the Government of India and ex officio Secretary to the GST Council, confirmed: “The 56th Meeting of the GST Council will be held on 3rd and 4th September, 2025. The details of the venue and agenda items will be communicated in due course.”
The announcement follows Prime Minister Narendra Modi’s Independence Day address, in which he promised a “big reform of GST” and a “very big gift” for people this Diwali.
Finance Minister Sitharaman, addressing the two-day GoM meeting earlier, had said that a simplified system would benefit the common man, farmers, the middle class and small businesses, while also making GST more transparent and growth-oriented.
The GoM also reviewed the Centre’s suggestion to exempt GST on individual health and life insurance premiums. The final decision on all recommendations will be taken by the GST Council in its September meeting.
Agencies