GST Rate Cut: 150 Categories to See Price Drop, Big Relief for Indians!
The recent overhaul of India’s GST system, effective September 22, 2025, has brought sweeping tax cuts across multiple categories. While Mother Dairy’s move to reduce prices on over 150 dairy and processed food items has grabbed headlines, many other products and sectors are also seeing reductions. Consumers in India are about to see savings not just in the grocery aisle, but also when buying everyday personal care items, vehicles, home appliances and more.
Mother Dairy Leads, But Others Join In
Mother Dairy has committed to passing on the entire GST benefit to consumers. Prices of UHT milk in tetra packs will drop by about ₹2 per litre. Paneer, ghee, butter, cheese, ice creams and even Safal’s frozen snacks like French fries, along with jams, pickles and tomato puree, will now come under lower tax slabs, making them noticeably cheaper.
Larger GST Revamp Covers Many Sectors
The GST Council has collapsed the earlier four tax slabs into just two main rates of 5 percent and 18 percent, with a 40 percent slab reserved for luxury and so called sin goods such as cigarettes, gutkha, high end cars and luxury vehicles. Items previously taxed at 12 or 28 percent are now mostly in the lower 5 percent bracket, especially essentials, medicines and food products.
Everyday Essentials Become More Affordable
Beyond food and dairy, personal care items are seeing reductions. Shampoo, soap, toothpaste, talcum powder, feeding bottles and hair oil will now be taxed at 5 percent instead of higher rates. Products for children, baby care items, essential medicines and diagnostic tools including glucometers or spectacles are also getting cheaper. Many of these have moved from 12 or 18 percent GST to 5 percent or zero in some cases.
Vehicles, Appliances and Household Goods
Smaller cars such as petrol engines up to 1200 cc or diesel engines up to 1500 cc and motorbikes or scooters up to 350 cc are now taxed at 18 percent instead of 28 percent earlier. Home appliances including televisions, air conditioners and kitchen gadgets are likely to become more affordable. Musical instruments, electronics and furniture pieces that were earlier under higher GST slabs will also see rate cuts.
The cumulative effect is that many items in monthly shopping baskets, from groceries to toiletries to appliances, will cost less. Some savings might be small, just a few rupees at a time, but across many products in a household the relief adds up meaningfully. Retailers are being instructed to update labels so customers can clearly see new prices once the GST reforms kick in.
Not all price changes will be visible immediately. Inventory bought earlier at old rates may still be sold until stock clears. Luxury and high end items as well as sin goods are excluded from benefits and in some cases may even see taxes increase. Finally, while rates are officially reduced, how each manufacturer and retailer adjusts pricing may vary, and some may delay or only partially pass on the benefits.
