PM Modi’s FIRST Reaction As GST Council Gives Nod To 2-Slab System

Prime Minister Narendra Modi on Wednesday said the Union Government’s push for next-generation reforms in the Goods and Services Tax (GST) has been accepted by the GST Council, describing the move as one that would benefit farmers, MSMEs, the middle class, women and youth.

“During my Independence Day Speech, I had spoken about our intention to bring the Next-Generation reforms in GST. The Union Government had prepared a detailed proposal for broad-based GST rate rationalisation and process reforms, aimed at ease of living for the common man and strengthening the economy. Glad to state that GST Council comprising the Union and the States, has collectively agreed to the proposals submitted by the Union Government on GST rate cuts & reforms, which will benefit the common man, farmers, MSMEs, middle-class, women and youth,” PM Modi posted on X.

During my Independence Day Speech, I had spoken about our intention to bring the Next-Generation reforms in GST.

The Union Government had prepared a detailed proposal for broad-based GST rate rationalisation and process reforms, aimed at ease of living for the common man and…

— Narendra Modi (@narendramodi) September 3, 2025

Meanwhile, Defence Minister Rajnath Singh remarked that this reform will bring ease of living and doing business while also boosting India’s self-reliance. He stated, “The Government of India, under the leadership of PM Narendra Modi, has announced the Next-Gen GST reforms to bring relief across sectors. With tax rates reduced on many important items, this reform will bring ease of living, further strengthen ease of doing business, empower small businesses, and boost India’s self-reliance under Aatmanirbhar Bharat. I thank PM Modi and the FM Smt. Nirmala Sitharaman for taking this bold decision.”

Dual GST Slab System from September 22

The GST Council, at its 56th meeting chaired by Union Finance Minister Nirmala Sitharaman, approved a simplified dual rate system of 5 per cent and 18 per cent, replacing the earlier four-slab structure. Sitharaman, addressing reporters after the meeting, announced that the new system will come into effect on 22 September.

She expressed gratitude to all members of the Council, noting their unanimous consent despite “minor” concerns. “PM Modi asked to give relief to customers in GST,” she said, while underlining that the reforms were designed with the common man in mind.

“These reforms have been carried out with a focus on the common man. Every tax on the common man’s daily use items has gone through a rigorous review and in most cases the rates have come down drastically… Labour intensive industries have been given a good support. Farmers and the agriculture sector, as well as the health sector, will benefit. Key drivers of the economy will be given prominence,” Sitharaman added.