All That You Should Not (and Should) Buy Before September 22: GST Rate Cuts on Everyday Goods and Services
The 56th GST Council Meeting has proposed rate revisions on a number of goods and services.
The 56th meeting of the Goods and Services Tax (GST) Council which was held on 3rd September, 2025 recommended sweeping, HSN-wise tax changes on a variety of goods which shall come into effect from 22 September 2025. The changes are slated to come in a phased manner, with service-rate changes effective from that date and most goods following the same timeline.
Most notably, the changes would shift a large number of consumer staples from mid-rate slabs to lower rates while simultaneously raising taxes on selected luxury and sin items.
Personal Care and Hygiene
Consumers should consider delaying purchases of items that the Council has explicitly moved down in the tariff tables. Personal care and hygiene goods such as:
- Hair oil, shampoo, toothpaste, toothbrush, dental floss and shaving cream move from the 18% bracket to 5%
- Toilet soap and tooth powder also see steep cuts to 5%
School Supplies
GST on school supplies including:
- Pencils, crayons and notebooks shall be reduced to nil.
- Low-value stationery items such as erasers shall be shifted to nil as well.
However, with technological incursion expanding rapidly within the educational system, there leaves more to be yearned.
Consumer Electronics
Large consumer electronics that carried 28% GST are being brought down to 18%, specifically:
- Air-conditioning machines
- Televisions above 32 inches
- Monitors and projectors
- Dishwashing machines
The cuts are notable considering the changing economic trends in home purchases and the elevation of the living standards across the social strata.
Medicines and Healthcare
The Council has also announced that:
- All regular medicines would move from 12% to 5%
- Glucometers from 18% to 5%
- A set of 36 life-saving drugs are shifted to nil
These reductions are significant for households managing chronic health conditions and the effective cost relief is expected to be felt directly at pharmacies once the new rates take effect on September 22.
Food and Dairy Products
The food and dairy sector also shows sharp reductions with:
- Butter, ghee and cheese being dropped from the 12% GST rate to 5%
- Packaged snacks such as namkeens and bhujia also drop from 12% to 5%
- Feeding bottles, baby napkins and clinical diapers are also reduced to 5%
Automobiles
- Smaller petrol/CNG vehicles and specific hybrid cars are reduced from 28% to 18%, aligning them with lower slabs
Luxury and Sin Goods
Conversely, items labelled as luxury or sin goods face higher rates. The Council’s tables show:
- Aerated drinks, certain tobacco products and specified luxury cars moving into a higher tax bracket of 40%
- Social-event admissions such as major sporting events are also listed at an increased rate of 40%
Services
With the effective costs on some major goods set to fall, will service prices fall where input goods become cheaper? The answer is: not automatically. The Council has separately reduced certain service rates. For example:
- Beauty and physical well-being services are reclassified from 18% to 5%, paving the way for lower bills in that sector
But final retail or service pricing depends on business margins, competition, input tax credits and how quickly vendors pass savings to consumers.
Practical Takeaway
Buy ahead only if the Council has raised GST on the item you want; wait if the item or related service is scheduled for a cut. Note that exceptions such as pan masala, gutkha and certain tobacco items remain at current rates until compensation-cess liabilities are discharged.
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