Union Finance Minister Nirmala Sitharaman stated that the GST 2.0 reforms, which simplify the indirect tax structure to two slabs, are expected to introduce Rs 2 lakh crore into the economy, allowing individuals to retain more cash that would otherwise be paid in taxes. During the ‘Outreach Programme on Next-Gen GST Reforms’ in Visakhapatnam on Wednesday, she elaborated on how the new tax system, featuring 5 percent and 18 percent rates, will lower the costs of daily necessities, easing the financial strain on the poor and middle class. These new GST rates are set to take effect on September 22.
Sitharaman also mentioned that the NDA government applied five criteria before adjusting the rates: lowering taxes for the poor and middle class, meeting the aspirations of the middle class, supporting farmers, being pro-MSME, and boosting sectors that contribute to job creation and export capabilities. She emphasized that these reforms would enhance the purchasing power of the average citizen. Regarding agriculture, she indicated that the Union government is concentrating on modernizing the sector. Sitharaman noted that GST revenues surged to Rs 22.08 lakh crore in 2025 from Rs 7.19 lakh crore in 2018 (FY2017-18), and the number of taxpayers increased to 1.51 crore from 65 lakh.
Criticizing the previous UPA government, she referred to earlier tax systems as tax terrorism, highlighting the significant effort put into implementing GST for a unified tax structure.