Wed Sep 03 16:40:00 UTC 2025: ## Major GST Overhaul: Key Items Now Tax-Free as Council Restructures Rates

**New Delhi:** In a significant decision with potentially widespread benefits, the GST Council, led by Finance Minister Nirmala Sitharaman, has approved a major restructuring of the Goods and Services Tax (GST) framework. The 12% and 28% tax slabs have been eliminated, leaving only the 5% and 18% slabs. Effective September 22, 2025, these changes, hailed as a “Diwali gift” for citizens and businesses, aim to simplify the tax structure and provide relief to consumers.

A key highlight of the council’s decision is the elimination of GST on several essential items, including certain food products, health services, and life-saving drugs. Pre-packaged and labelled paneer (cottage cheese), UHT milk, pizza bread, khakhra, chapati/roti, paratha, and other Indian breads will now be tax-free, previously attracting a 5% GST.

Furthermore, essential educational materials like uncoated paper and paperboard used in exercise books, graph books, and laboratory notebooks, as well as the finished notebooks themselves and erasers, will also be subject to 0% GST.

In a boost for healthcare, a range of critical life-saving drugs used in the treatment of cancer, rare diseases, and chronic illnesses have also been moved to the 0% GST bracket. This move is expected to significantly reduce the cost of treatment for patients suffering from these conditions.

This sweeping overhaul of GST rates is expected to have a significant impact on the Indian economy, providing relief to consumers and simplifying the tax structure for businesses. The changes are anticipated to make essential goods more affordable and contribute to overall economic growth.

**(Other articles mentioned, about reduction of tax for AC, TV, and life insurance are not included in the text and will be a different news article)**

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