GST rate cuts reaching consumers, reforms widely welcomed: Sitharaman

Finance Minister Nirmala Sitharaman said that the benefits of the recent Goods and Services Tax (GST) rate reduction have been well received across the country, with the impact of the cuts reaching consumers across all categories.

Speaking at a joint press conference with Commerce Minister Piyush Goyal and Electronics & IT Minister Ashwini Vaishnaw, Sitharaman said the government has been closely monitoring 54 key items to ensure that the tax benefits are being passed on to end users.

“For every item I have monitored, which affects the day-to-day life of citizens, the weighted average of the reduction is being passed on, and in some cases, even more. The impact of these new GST rate cuts is remarkable,” Sitharaman said, sharing the percentage of benefits passed on across different items.

The minister explained that while a few products, such as high-end Portland cement, witnessed a smaller-than-expected pass-through, overall, the rate cuts have effectively translated into lower prices for consumers.

“These changes were implemented from September 22, the first day of Navratri, and feedback from the ground shows that consumers have welcomed them,” she said. The latest GST reductions included rate cuts from 12 per cent to 5 per cent and from 28 per cent to 18 per cent on a majority of goods.

‘Biggest GST reform since Independence’

Goyal described the move as the “biggest GST reform since Independence,” highlighting its multiplier effect on the economy by spurring consumer spending, driving investments, and supporting infrastructure growth. He also noted that most e-commerce platforms have successfully passed on the tax benefits to consumers.

Second semiconductor plant begins production

Vaishnaw pointed to record sales during the Navratri period, with 20–25 per cent higher sales across electronics categories such as smartphones, air conditioners, washing machines, and set-top boxes. He said the GST reforms have also helped curb food inflation, noting that food prices have been in deflation for the past four months.

Vaishnaw further added that India’s electronics manufacturing sector continues to expand at a double-digit pace, employing nearly 25 lakh people directly, and that the country’s second semiconductor plant began production last week.