Business EconomyPosted at: Sep 8 2025 4:16PM


Next-Gen GST overhaul big boost to consumers and small businesses

New Delhi, Sep 8 (UNI) Food-processing sector has been a major beneficiary in rationalisation of tax, with most products witnessing a decline to 5pc GST slab, an official statement said today.
The statement said, “Benefits of GST rate rationalisation will lead to simplified tax structures, support for manufacturing, better revenue generation and resolving clarification issues.”
“Changes in GST Tax rates will provide relief to individuals, common man and the aspirational middle class,” the document added.
The simplified structure is expected to bring uniformity across food items, reduce compliance costs, and create a stable tax environment that will encourage long-term investment and economic growth.
Consumers shall witness overall reduced food prices, making staples more affordable and stimulating demand. This, in turn, is likely to boost sales for FMCG and packaged food businesses.
Additionally, the correction of inverted duty structures — where inputs were taxed higher than finished products — will improve liquidity, especially for MSMEs, reduce working capital blockage, and promote domestic value addition.
The Council has cleared several procedural reforms through streamlined registration and return filing processes, provisional refund mechanisms for inverted duty claims, and the implementation of the Goods and Services Tax Appellate Tribunal (GSTAT) to expedite appeal resolutions and reduce litigation.
The ‘Goods and Services Tax Appellate Tribunal (GSTAT)’ has been constituted by the Government of India under section 109 of the Central Goods and Services Tax Act 2017.
The official statement added that the manufacturing and processed food industries are set to gain from the reform. Lower GST rates and reduced prices are expected to drive consumption, encourage new investments, and generate additional employment opportunities.
Farmers and food processors are also expected to benefit from increased demand, better value addition, and reduced post-harvest losses, which could improve incomes across the sector.
Recently, the GST Council has reduced the GST structure from four slabs (5pc, 12pc, 18pc, 28pc) to two main rates–5pc (merit rate) and 18pc (standard rate), along with a 40pc special rate for sin/luxury goods. These changes come into effect from September 22, 2025.
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