In response to Unstarred Question No. 1374 in the Lok Sabha, Smt. Sajda Ahmed inquired about the impact of Goods and Services Tax (GST) reduction. The Minister of State in the Ministry of Finance, Shri Pankaj Chaudhary, stated that the Government rationalized GST rates on many goods and services following the recommendations of the 56th GST Council meeting held on 03.09.2025. This included reductions from 28% to 18%, 18% to 12/5%, and 12% to 5%/Nil. The GST Council, in its 45th meeting held on 17th September 2021, constituted a Group of Ministers (GoM) on Rate Rationalisation to simplify the rate structure, correct inverted duty structures, reduce classification-related disputes, and enhance GST revenue. Additionally, based on the recommendations of the 54th GST Council meeting held on 09.09.2024, a GoM on Life and Health Insurance was constituted on 15.09.2024 to examine and review the present tax structure of GST on life and medical insurance. The reports of both GoMs were presented at the 56th GST Council meeting held on 03.09.2025, which recommended GST rate reductions with the goal of improving the lives of all citizens and ensuring ease of doing business.
Key Entities Referenced
Goods and Services Tax (GST): A value-added tax levied on most goods and services sold for domestic consumption.
GST Council: A council responsible for making recommendations on issues related to GST.
Group of Ministers (GoM) on Rate Rationalisation: A group constituted to undertake GST rate rationalization, correction of inverted duty structure with an objective to simplify the rate structure, to reduce classification related disputes and enhance GST revenue.
Ministry of Finance: The ministry responsible for the financial matters of the Government of India, including taxation.
GOVERNMENT OF INDIA
MINISTRY OF FINANCE
DEPARTMENT OF REVENUE
LOK SABHA
UNSTARRED QUESTION NO. 1374
TO BE ANSWERED ON MONDAY, DECEMBER 08, 2025/AGRAHAYANA
17, 1947 (SAKA)
IMPACT OF GST REDUCTION
1374. SMT. SAJDA AHMED:
Will the Minister of FINANCE be pleased to state:
(a) whether the Government has recently reduced Goods and
Services Tax (GST) rates on several items, if so, the details
thereof;
(b) the reasons for the reduction in GST rates;
(c) whether any survey/study or consultation has been conducted
with stakeholders before such rate reduction, if so, the details
thereof; and
(d) whether the Government has assessed the possible impact of
the rate reduction, if so, the details thereof?
ANSWER
MINISTER OF STATE IN THE MINISTRY OF FINANCE
(SHRI PANKAJ CHAUDHARY)
(a) Yes, based on the recommendations of the 56th GST Council
meeting held on 03.09.2025, the Government has rationalized GST
rates on many goods and services and reduced GST rates from 28%
to 18%, 18% to 12/5%, 12% to 5%/Nil.
(b), (c) and (d) Based on the recommendations of the GST Council in
its 45th Meeting held on 17th September 2021, a Group of Ministers
(GoM) on Rate Rationalisation was constituted to undertake GST
rate rationalization, correction of inverted duty structure with an
objective to simplify the rate structure, to reduce classification
related disputes and enhance GST revenue.
Further, based on the recommendations of the 54th GST Council
meeting held on 09.09.2024, Group of Ministers (GoM) on Life andHealth Insurance was constituted on 15.09.2024 to examine and
review the present tax structure of GST on life and medical
insurance.
The reports of both these GoMs were presented before the GST
Council in its 56th meeting held on 03.09.2025. The GST Council
recommended reduction in GST rates with a multi-sectoral and
multi-thematic focus on improving the lives of all citizens and
ensuring ease of doing business for all, including small traders and
businessmen.
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