GST 2.0 to boost consumption and provide cushioning against headwinds emanating from US tariffs: Industry

New Delhi: The GST rate rationalisation is set to kick off a cycle of growth for India’s economy, driven by a major consumption boost, and provide much-needed cushion against the headwinds emanating from “lopsided” tariff regimes being pushed by the US, industry leaders said on Thursday.

The GST Council on Wednesday cleared sweeping changes to the indirect tax regime, approving an overhaul of rates by limiting slabs to 5 per cent and 18 per cent effective from September 22, the first day of Navaratri.

Ashok P Hinduja, Chairman, Hinduja Group of Companies (India), said the GST rate cuts announced across the board augur well for the economy as they will support India’s macroeconomic stability by spurring demand at the grassroots level.

Mahindra Group Chairman Anand Mahindra took to social media platform X and batted for more such reforms to spur consumption and drive invest.

CII Economic Affairs Council Chairman R Dinesh asserted that the reduction of GST rates on essential goods such as dairy products, medicines and everyday household items, along with reforms in processes and institutional strengthening, will directly benefit consumers, the aspirational middle class, and industry alike.

“The consumption boost has the potential to start a virtuous cycle of growth,” he added.

Rajneesh Kumar, Chief Corporate Affairs Officer, Flipkart Group, said timely implementation of these reforms ahead of the upcoming festival season will surely give a huge boost to consumption across categories, widen market access, and accelerate our collective journey towards a Viksit Bharat.

Ashishkumar Chauhan, MD & CEO, NSE, said the introduction of GST itself was one of the most significant economic reforms in India’s history, laying the foundation for a unified, transparent, and efficient tax regime. The latest measures build on that foundation and take it further.