"Bachhat Utsav begins tomorrow": What PM Modi says on GST 2.0 | Read here

On the auspicious eve of Navratri, Prime Minister Narendra Modi addressed the nation, heralding a new economic chapter with the official rollout of GST 2.0. In his address, the Prime Minister described the sweeping reforms as the beginning of a "Bachat Utsav," or a festival of savings, and promised that the changes would significantly ease the financial burden on households and businesses across the country. He emphasized that this reform would also boost India’s appeal as a top destination for investment and entrepreneurship.

The core of this new economic chapter is a major simplification of the Goods and Services Tax structure. The GST Council, in a decision made earlier this month, approved a streamlined two-tier rate system of 5 per cent and 18 per cent. This new system is scheduled to take effect from September 22, perfectly coinciding with the first day of Navratri, symbolizing a fresh start for the nation's economy.

A key benefit of this reform is the drastic reduction in tax slabs for a wide range of goods. According to the new structure, nearly 99 per cent of all goods that were previously taxed at a rate of 12 per cent will now be moved into the more affordable 5 per cent bracket. Additionally, about 90 per cent of items that were earlier under the highest tax slab of 28 per cent will now be brought down to the 18 per cent category. A 40 per cent compensation cess, however, will continue to apply to luxury and sin goods.

The Prime Minister credited the cooperative efforts of both the Central government and the states for successfully implementing this reform. He noted that their combined work had finally freed the nation from the burden of a dozen different taxes, making the long-cherished dream of "one nation, one tax" a tangible reality for every citizen. He also took the opportunity to reflect on the pre-2014 era, recalling how businesses and citizens were trapped in a complex maze of taxes that inflated costs and strained household budgets.

PM Modi highlighted that the new reforms would act as a "double bonanza" for the people. Not only would the changes make essential goods and services cheaper, but they would also lead to increased savings for households. This, he argued, would have a significant positive impact on the economy by putting more disposable income in the hands of the public, which could then be used for consumption and investment.

He drew a direct link between the new GST and the Union Budget decision earlier this year to make income up to Rs 12 lakh tax-free. The Prime Minister said that both these measures were aimed squarely at easing the financial burden on India’s rapidly expanding middle class, ensuring that they can enjoy a better quality of life and contribute more effectively to the nation’s economic growth and development.