GST Rates in India 2025: Updated List of Tax Slabs

From understanding the GST rate list to managing compliance, staying informed about GST slab rates is essential for ensuring financial stability and growth.
Check Eligibility
Business Loan
Check Eligibility
2 minutes
05 September 2025

The Goods and Services Tax (GST) is a unified taxation system in India that replaced multiple indirect taxes, including VAT, excise duty, and service tax. It was introduced to simplify the country’s complex tax structure and enhance overall efficiency. In this article, we’ll cover the current GST rates in India, key details you should be aware of, and the recent changes brought in through the GST reforms implemented on September 3, 2025.

GST Reforms 2025: Key Changes in GST Rates Across Categories

India’s GST system has been overhauled into a simpler two-tier rate structure of 5% and 18%, while luxury and sin goods are now taxed at 40% (compared to the earlier multi-slab system of 5%, 12%, 18%, and 28%). Key categories have seen rate reductions: daily essentials have dropped from 12%/18% to 5%, agricultural equipment from 12%/18% to 5%, healthcare services to 5% or exempt, and education services are now fully tax-exempt. GST on automobiles and electronic appliances has been reduced from 28% to 18%. Additionally, process improvements such as faster refunds and automatic registration have simplified compliance for businesses.

New GST Rates in India (Effective September 22, 2025)

The GST rate structure has been simplified into three core slabs: 0%, 5%, and 18%, with a higher 40% rate specifically applied to luxury and sin goods. This reform aims to reduce taxes on essential and commonly used items, making them more affordable for the public, while also easing tax compliance for businesses.

Revised GST Rates for Select Items

Category

Previous GST Rate

New GST Rate

Scrap and polyurethanes

5%

5%

Pens

12%

5%

Metal concentrates and ores

5%

5%

Reproduction of recorded media and printed material

12%

5%

Packaging containers and boxes

12%

5%

Certain renewable energy devices

12%

5%

Broadcasting, sound recording, and licensing

12%

5%

Printed materials

12%

5%

Railway goods and parts (Chapter 86)

12%

5%

 

The GST Council continues to assess and update rates based on economic conditions and sector-specific requirements to ensure balanced growth and fairness in taxation.

Business Loan
Business Loan

Decrease in the GST rates

To enhance affordability and support social welfare, the GST Council has introduced key rate reductions on essential goods and services.

Notable GST Rate Cuts – Effective from September 22, 2025

Category

Previous GST Rate

New GST Rate

Applicability

Vehicles retrofitted for persons with disabilities

Not specified (typically 12%)

5%

This reduced rate makes specially adapted vehicles more accessible and affordable for individuals with disabilities.

Cancer treatment drugs (e.g., Keytruda)

12%

0% (Exempt)

GST has been fully waived on select life-saving medications for cancer and other serious illnesses, offering major relief to patients.

Goods sold at Indo-Bangladesh border haats

Not specified

0% (Exempt)

IGST is not applied on goods traded at border haats, encouraging local trade and strengthening regional economic cooperation.

 

These changes reflect the GST Council’s continued efforts to balance revenue generation with social and economic support.

Kinds of GST rates and structures in India

India's GST system underwent a significant overhaul on September 22, 2025, aligning with the latest amendments in the GST law. The previous multi-slab structure (5%, 12%, 18%, and 28%) has now been simplified into a more streamlined framework featuring three core rates. This reform aims to make essential goods more affordable and simplify compliance for businesses.

Under the new regime, a Merit Rate of 5% applies to a broad category of commonly used goods, such as packaged food items, basic household products like toothpaste and soap, and essential services. The Standard Rate of 18% is now levied on most goods and services, including consumer electronics and compact cars, which were earlier taxed at higher rates. A new 40% rate has been introduced for luxury and "sin" goods, including premium cars, tobacco products, and aerated beverages—replacing the earlier 28% GST plus cess structure.

The GST framework still uses Integrated GST (IGST) for interstate transactions, while Central GST (CGST) and State GST (SGST) are applicable on intrastate supplies. For businesses and individuals looking to accurately compute taxes under the new structure, a GST Calculator can be used to estimate applicable tax based on updated slabs and the base price of goods or services.

Here is an overview of GST rates:

GST Rate

Applicable Goods and Services

Purpose

0%

Essential items like fresh milk, eggs, curd, unpackaged foodgrains, along with educational and healthcare services.

Ensures basic necessities and critical services remain affordable and accessible to all citizens.

5%

Widely used goods such as coal, edible oils, tea, domestic LPG, most packaged foods, household products like soap and toothpaste, and essential medicines.

Designed to keep everyday items affordable and accessible for the general population.

18%

Consumer durables including air conditioners, televisions, refrigerators, washing machines, and most vehicles (like small cars and motorcycles up to 350cc). Also covers the majority of services.

Balances revenue generation with affordability for commonly used goods and services.

40%

Luxury and sin goods such as premium cars, high-end motorcycles (over 350cc), and aerated beverages.

Imposes the highest tax to discourage consumption of non-essential or harmful products while maximizing revenue.


List of Items Taxed at 0% GST Rate

Product/Service

Previous GST Rate

Revised GST Rate

Individual life and health insurance policies

18%

0% (Exempt)

Maps, charts, and globes

12%

0% (Exempt)

Pencils, sharpeners, erasers, crayons, and notebooks

5% or 12%

0% (Exempt)

Pre-packaged and labelled paneer

5%

0% (Exempt)

All Indian breads (roti, paratha, parotta, etc.)

5%

0% (Exempt)

Unbranded milk, eggs, curd, and lassi

0%

0% (Exempt)

Unpacked foodgrains, atta, maida, and besan

0%

0% (Exempt)

Fresh vegetables and fruits

0%

0% (Exempt)

Educational and healthcare services

0%

0% (Exempt)

Select life-saving cancer medications

5% or 12%

0% (Exempt)

 

These changes are aimed at increasing affordability and easing the tax burden on essential goods and services for the general public.

List of Items Taxed at 5% GST Rate

Effective from September 22, 2025

Product/Service

Previous GST Rate

Revised GST Rate

Hair oil, shampoo, soap, and toothpaste

18%

5%

Butter, ghee, cheese, and dairy spreads

12%

5%

Packaged food items (e.g., namkeen, biscuits, pasta, cornflakes, cereals)

12% or 18%

5%

Utensils, bicycles, and kitchenware

12% or 18%

5%

Apparel priced up to Rs. 2,500

12%

5%

Footwear priced up to Rs. 2,500

12%

5%

Jams, sauces, pickles, and soups

12% or 18%

5%

Dry fruits and nuts

12%

5%

Diagnostic kits and reagents

12% or 18%

5%

Surgical instruments and thermometers

18%

5%

Services at salons, gyms, and yoga centers

18%

5%

Hotel stays with tariffs between Rs. 1,000 and Rs. 7,500

12%

5%

Fertilizers and agricultural machinery

12% or 18%

5%

Spectacles and corrective goggles

28%

5%

Life-saving medicines (excluding those fully exempted)

12%

5%


List of Items Replaced from 12% GST Rate to 5% GST Rate

Product/Item

Previous GST Rate

New GST Rate (Effective Sept 22, 2025)

Butter

12%

5%

Ghee

12%

5%

Packaged or processed food items

12%

5%

Almonds

12%

5%

Fruit juice

12%

5%

Ready-to-eat vegetable preparations

12%

5%

Processed fruits

12%

5%

Pickles, murabba, chutneys, jams, jellies, and similar preserves

12%

5%

Packed coconut water

12%

5%

Umbrellas

12%

5%


List of Items Taxed at 18% GST Rate

Product/Service

Previous GST Rate

New GST Rate (Effective Sept 22, 2025)

Consumer Durables (Air conditioners, televisions, refrigerators, washing machines)

28%

18%

Small Cars (Petrol engines under 1200cc, diesel engines under 1500cc, length under 4 meters)

28%

18%

Motorcycles (Engine capacity up to 350cc)

28%

18%

Commercial Vehicles (Buses, trucks, three-wheelers, ambulances)

28%

18%

Auto Parts

28%

18%

Cement

28%

18%

All Types of Batteries

28%

18%

Printers and Computers

18%

18%

Capital Goods

18%

18%

Industrial Intermediate Goods

18%

18%

Road Tractors (Engine capacity above 1800cc for semi-trailers)

28%

18%


List of Items Replaced from 28% to New 40% and 18% GST Slabs

Product/Item

Old GST Rate + Cess

New GST Rate (Effective Sept 22, 2025)

Small cars

28% + 1% or 3% cess (total 29-31%)

18%

Premium motorcycles (over 350cc)

28% + up to 15% cess (total 43%)

40%

Consumer durables such as air conditioners and refrigerators

28%

18%

Luxury and sin goods (e.g., luxury cars)

28% + 22% cess (up to 50% total)

40%

Cigarettes and carbonated drinks

28% + up to 15% cess

40%

 

List of Items Taxed at 40% GST Rate

The GST Council’s significant tax reforms, effective from September 22, 2025, have introduced a new 40% GST rate. This single rate replaces the earlier combination of 28% GST plus additional cess on luxury and "sin" goods, simplifying the tax structure.

Below is a list of items now classified under the 40% GST slab, along with their previous and updated tax rates:

Product/Service

Old GST Rate + Cess

New GST Rate (Effective Sept 22, 2025)

Luxury and Premium Cars

28% GST + up to 22% cess (up to 50%)

40% GST

Motorcycles (Engine capacity > 350cc)

28% GST + 3% cess (31% total)

40% GST

Aerated and Carbonated Beverages

28% GST + 12% cess (40% total)

40% GST

Yachts and Personal Aircraft

28% GST + applicable cess

40% GST

Revolvers and Pistols

28% GST + applicable cess

40% GST

Betting, Online Gaming, and Casinos

28% GST

40% GST

Admission to Sports Events (e.g., IPL)

28% GST

40% GST

 

Note on Tobacco: The GST Council has indicated that tobacco, pan masala, and related products will eventually move to the 40% slab. However, these will continue under the current 28% GST plus compensation cess until GST compensation loan dues to states are fully settled.

List of Items Taxed at 3% GST Rate

The GST reforms effective from September 22, 2025, have introduced major changes to India’s tax system. However, the GST rates on precious metals and stones remain unchanged.

Below is a list of items that continue to be taxed at a 3% GST rate:

Products

GST rate

Imitation jewellery

3%

Items made of or coated with precious metals

3%

Natural or cultured pearls (not strung, mounted, or set; or temporarily strung for transport)

3%

Worked diamonds, not mounted or set (excluding non-industrial use)

3%

Precious and semi-precious stones (excluding diamonds)

3%

Silver

3%

Gold

3%

Waste or scrap of precious metals or metals coated with precious metals

3%


List of Items Taxed at 0.25% GST Rate

The GST Council introduced significant tax reforms effective September 22, 2025, simplifying various tax rates. However, the special 0.25% GST rate for the gems and jewelry sector remains unchanged.

Below is a list of items that continue to be taxed at 0.25% GST:

Products

GST Rate

Non-industrial grade diamonds

0.25%

Unprocessed precious or semi-precious stones

0.25%

Synthetic or reconstructed precious or semi-precious stones

0.25%


How the 40% GST Slab Replaces Cess?

The GST framework, as defined by GST law, now features a simplified two-tier structure along with a special higher rate that replaces the previous cess system. Certain goods and services that were earlier subject to both GST and a compensation cess have now been grouped under a single 40% GST slab. This category includes luxury cars, aerated beverages, and select high-end motorcycles, aiming to simplify taxation and enhance transparency by removing the complexity of GST plus cess calculations.

However, the compensation cess has not been completely abolished. It continues to apply to tobacco and related products as a temporary measure until the government fully repays its financial commitments to compensate states for revenue losses. The revised system still employs mechanisms like TDS under GST and TCS under GST to ensure compliance and streamline tax collection, making the overall tax structure more straightforward and fair.

HSN and SAC system

In India, the classification of goods and services under GST is based on the HSN (Harmonized System of Nomenclature) code for goods and SAC (Services Accounting Code) for services. HSN is a globally accepted system, while SAC is India-specific. Although these codes continue to determine applicable GST rates—now simplified into fewer slabs—the major update lies in reporting requirements.

Starting May 2025, businesses with annual turnover up to Rs. 5 crore must report 4-digit HSN codes, while those exceeding this limit must use 6-digit codes. The GST portal now enforces this using mandatory dropdown menus, eliminating manual entry errors. This update, supported by a validation system, aims to improve accuracy, ensure compliance, and streamline the GST return filing process.

Why Bajaj Finserv Business Loan?

While navigating the intricacies of GST rates is essential for business success, access to adequate financing is equally crucial for fuelling growth and expansion. With Bajaj Finserv Business Loan, businesses can access tailored financing solutions designed to meet their unique needs.

With loan amounts up to Rs. 80 lakh and flexible repayment options, our business loan can help you take your business to the next level. Here are some benefits of opting for our business loan:

  1. Quick disbursal of funds
  2. Low interest rates
  3. No collateral required
  4. Approval within 48 hours
  5. Flexible repayment tenure of up to 96 months

Whether you are looking to invest in infrastructure, expand your operations, or optimise working capital, Bajaj Finserv Business Loan offers the financial support you need to thrive in today's competitive market.

Bajaj Finserv app for all your financial needs and goals

Trusted by 50 million+ customers in India, Bajaj Finserv App is a one-stop solution for all your financial needs and goals.

You can use the Bajaj Finserv App to:

  • Apply for loans online, such as Instant Personal Loan, Home Loan, Business Loan, Gold Loan, and more.
  • Invest in fixed deposits and mutual funds on the app.
  • Choose from multiple insurance for your health, motor and even pocket insurance, from various insurance providers.
  • Pay and manage your bills and recharges using the BBPS platform. Use Bajaj Pay and Bajaj Wallet for quick and simple money transfers and transactions.
  • Apply for Insta EMI Card and get a pre-qualified limit on the app. Explore over 1 million products on the app that can be purchased from a partner store on Easy EMIs.
  • Shop from over 100+ brand partners that offer a diverse range of products and services.
  • Use specialised tools like EMI calculators, SIP Calculators
  • Check your credit score, download loan statements and even get quick customer support—all on the app.

Download the Bajaj Finserv App today and experience the convenience of managing your finances on one app.

Do more with the Bajaj Finserv App!

UPI, Wallet, Loans, Investments, Cards, Shopping and more

GET THE APP

Disclaimer

1. Bajaj Finance Limited (“BFL”) is a Non-Banking Finance Company (NBFC) and Prepaid Payment Instrument Issuer offering financial services viz., loans, deposits, Bajaj Pay Wallet, Bajaj Pay UPI, bill payments and third-party wealth management products. The details mentioned in the respective product/ service document shall prevail in case of any inconsistency with respect to the information referring to BFL products and services on this page.

2. All other information, such as, the images, facts, statistics etc. (“information”) that are in addition to the details mentioned in the BFL’s product/ service document and which are being displayed on this page only depicts the summary of the information sourced from the public domain. The said information is neither owned by BFL nor it is to the exclusive knowledge of BFL. There may be inadvertent inaccuracies or typographical errors or delays in updating the said information. Hence, users are advised to independently exercise diligence by verifying complete information, including by consulting experts, if any. Users shall be the sole owner of the decision taken, if any, about suitability of the same.

Frequently asked questions

What is the GST gold rate?

The GST rate for gold in India is 3%. This rate applies to the value of the gold itself, including gold jewellery, coins, and articles. Additionally, there is a separate 5% GST on the making charges when gold is sold as jewellery. The GST rate ensures that gold is taxed uniformly across the country.

What is the GST rate applicable on mobile?

Mobile phones in India are taxed at a standard 18% GST rate. This rate applies to both smartphones and feature phones. Despite the recent GST reforms that lowered rates for many consumer goods, the GST on mobile phones remains at 18%, ensuring uniform taxation regardless of the brand or model.

What are the GST rates applicable on goods and services?

The GST rates in India have been simplified to three main slabs: 5%, 18%, and 40%. The 5% rate applies to essentials and common household goods, the 18% rate is the new standard for most consumer products and services, and the 40% rate is for luxury and "sin" goods. The old 12% and 28% slabs have been largely eliminated, with most items from those categories being moved to the new 5% or 18% slabs.

What are the correct GST slabs on goods and services?

The GST rates in India have been simplified to three main slabs: 5%, 18%, and 40%. The 5% rate applies to essentials and common household goods, the 18% rate is the new standard for most consumer products and services, and the 40% rate is for luxury and "sin" goods. The old 12% and 28% slabs have been largely eliminated, with most items from those categories being moved to the new 5% or 18% slabs.

What is the current GST rate?

The current GST rates in India are divided into the following slabs: 0% (exempt), 5%, 18%, and 40%. The 0% rate is for fresh, unbranded essentials, while the 5% and 18% rates cover the majority of goods and services. The new 40% rate applies to a few select luxury and demerit items. The old 12% and 28% rates no longer exist for most products.

What product is 18% GST?

The 18% GST rate is now the new standard rate, applying to a wide range of goods and services. This includes many items that were previously taxed at a higher rate, such as mobile phones, air conditioners, refrigerators, televisions, and small cars. Other items that have moved to the 18% slab include consumer durables, small motorcycles, and most electronic components.

Is there a 10% GST rate?

No, there is no 10% GST rate in India. The GST rates are currently structured into the following slabs: 0%, 5%, 18%, and 40%. Each rate is designated for specific categories of goods and services, with the 12% and 28% slabs having been eliminated.

Show More Show Less

Related videos