Amit Shah Calls GST 2.0 India’s Biggest Reform
Home Minister Amit Shah has described the government’s new GST reform—GST 2.0—as one of the most sweeping tax overhauls since India’s independence. He said the reform goes beyond simple tax cuts, calling it “multi-dimensional.” Key goals, he added, include boosting investment, consumption, manufacturing, exports and public trust in taxation.
What Has Changed
Under GST 2.0, over 395 items have had their tax rates reduced. Many everyday goods have been moved to either zero rate or 5% GST. Sectors like health, agriculture, employment, and export-oriented goods are among those seeing rate relief. The rate slabs themselves have been simplified: the number of slabs reduced, with the 12% and 28% slabs being eliminated in many cases, leaving most goods in 5% or 18% slabs depending on category.
Expected Benefits and Challenges
Amit Shah expects the reform will widen the tax base even while reducing rates, as trust in the system increases and compliance improves. He believes prices for many goods will come down, benefiting consumers, particularly the middle class. Exports and manufacturing are likely to gain momentum. Experts note, however, some anomalies remain—such as differing treatment of goods and services under the same slab with or without input tax credits. These may pose implementation challenges.
Broader Impacts
GST 2.0 is seen by the government as not only simplifying the tax system but also supporting India’s larger economic goals, like Aatmanirbhar Bharat (self-reliant India). It is expected to stimulate demand, and with tax receipts stable, the fiscal impact is projected to be manageable. Stakeholders in MSMEs and consumer sectors are among those closely watching how the changes play out.
