The Tool Desk
Outbyte Driver Updater FREEScan for outdated or missing drivers - takes under a minuteDriver Scan →Outbyte PC Repair FREEClear out junk files and repair common Windows errorsFree Scan →Most GST rate changes announced in 2025 took effect on 22 September 2025, but the rate on a particular purchase depends on the exact product or service. The GST Council described the revised structure as two principal rates—5% and 18%—plus a 40% special rate for selected goods and services. Some goods became exempt, and specified tobacco products were excluded from the general start date.
What changed in India’s GST rates?
At its 56th meeting, the GST Council described a simplified structure with a 5% merit rate and an 18% standard rate, alongside a 40% special rate for selected goods and services. It also announced exemptions and changes for particular items. These headline rates are not a complete rate list: the applicable treatment depends on the specific goods or service and its classification. The Council’s announcement is available from the Ministry of Finance and PIB, 3 September 2025.
Among the Council’s announced examples, hair oil, toilet soap bars, shampoos, toothbrushes, toothpaste, bicycles, tableware, kitchenware and other household articles were among goods reduced to 5%. The announcement also described UHT milk and specified paneer or chena and Indian breads as moving from 5% to nil. These examples do not establish the rate for every product sold under a broad everyday label: the notified description and classification matter.
When did the new rates take effect?
For goods and services other than the specified tobacco products, the changes took effect on 22 September 2025, according to the Ministry of Finance’s GST FAQ, posted 3 September 2025.
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Tobacco products were an exception
The FAQ says the existing GST and compensation cess continued for cigarettes, chewing tobacco products such as zarda, unmanufactured tobacco and beedi. New rates for those specified goods were to begin on a later date to be notified, linked to discharge of the compensation-cess loan and interest liabilities. The FAQ does not establish whether a later notification has since changed that position. Check the latest official notification before relying on the exception for a current transaction.
What rate applies to common consumer examples?
The Ministry FAQ gives these examples. They illustrate why a precise description matters; they are not a substitute for checking the applicable tariff entry and current notification.
| Item described in the Ministry FAQ | Rate stated | Important distinction |
|---|---|---|
| Motorcycle up to and including 350 cc | 18% | A motorcycle above 350 cc is listed at 40%. |
| Motorcycle above 350 cc | 40% | The FAQ draws the line at engine capacity; 350 cc itself falls in the 18% category. |
| Bicycles and bicycle parts | 5% | The FAQ says the rate was reduced from 12%. |
| Spectacles or goggles for correcting vision | 5% | Other spectacles or goggles remain at 18% according to the FAQ. |
| Lithium-ion and other batteries under heading 8507 | 18% | The FAQ says batteries under that heading are now uniformly at 18%. |
These examples are from the Ministry’s GST FAQ follow-up. For an exact item, consult the notified description rather than inferring the rate from a brand, product name or broad category.
How to check the exact rate for an item
- Identify the precise item or service. A broad description such as “spectacles” may cover goods with different rates; features and tariff classification can change the answer.
- Check the applicable notification and effective date. The government FAQ identifies Notification 9/2025-Central Tax (Rate) for amended goods rates and Notification 10/2025-Central Tax (Rate) for exempt goods. It identifies Notification 2/2025-Compensation Cess (Rate) for amended compensation cess rates. The relevant schedules, rather than a simplified headline summary, control detailed classification.
- Check whether the item falls within an exception or exemption. In particular, specified tobacco goods had a deferred start date in the Ministry FAQ.
- For a purchase spanning the change, compare the supply, invoice and payment dates. The invoice date alone may not decide which rate applies.
The notification numbers and their roles are identified in the official FAQ follow-up.
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What if the supply, invoice and payment happened on different dates?
For transactions around a rate change, the Ministry FAQ points to section 14 of the CGST Act, which sets time-of-supply rules. The applicable rate depends on the transaction’s facts and the relevant dates, not simply the date a consumer receives an invoice.
- For a supply made before the change with an invoice issued afterward, if payment is received after the change, the FAQ says the time of supply is the earlier of the payment-receipt date or invoice date.
- If payment was received before the change, the FAQ says the time of supply is the payment-receipt date.
- For an advance where the supply is incomplete or no invoice has been issued, the FAQ says the rate is determined under the time-of-supply provisions.
These are summaries of the FAQ’s examples, not a universal rule for every transaction. If the dates or nature of the supply are disputed, check the legislation and the facts with a qualified adviser.
Independent reader supportYour contribution helps us test, update, and keep practical guides available for everyone.Do old MRP labels still apply?
Old packaging did not automatically have to be recalled or relabelled. The government’s follow-up FAQ on stock and labels says recalling, relabelling or restickering containers or packs of stock released into the market before 22 September 2025 was not mandatory if the manufacturer or marketing company ensured price compliance at the retailer level.
This is a conditional allowance for old market stock, not permission to charge an arbitrary price or ignore applicable consumer-price rules. If you dispute a charge, keep the bill and packaging and check the rules that apply to the particular sale.
Best Value
Did the GST changes guarantee lower shop prices?
No. A lower GST rate does not by itself establish that a retail price fell by a specific amount. The official materials cited here announce policy rates and selected examples; they do not provide a measured consumer saving or show that every affected product’s price changed by a fixed amount. The actual price on a bill can also reflect factors beyond the tax rate.
Quick Recap
Product prices and availability are accurate as of the date/time indicated and are subject to change. Any price and availability information displayed on Amazon at the time of purchase will apply.
