GST Rate Cut: Netizens Hail 'Diwali Gift' As 'Very Badly Needed Relief,' But Ask - Will It Be Passed On To Consumers

(MENAFN- Live Mint) Netizens welcomed the major overhaul of the GST tax regime, which the Union government referred to as a 'Diwali gift' and said was a“very badly needed reform”. However, several social media users asked if this change in the indirect tax regime would also be passed on to consumers.

The Internet was also flooded with Congress leader Rahul Gandhi 's tweets and videos from 9 years ago, claiming that the“visionary opposition leader” had suggested the same changes years ago.

Also Read | Does Congress want Tobacco taxed at 5%?: Nirmala Sitharaman Here's how netizens reacted to the GST rate cut:

“The first ever government which cares about the middle class,” hailed a user.

“Much-needed GST reforms ..!! Sure looks like a gift!!” added a user.

One user said,“Good move on GST reforms. Nation very badly needed this relief.”

Another deemed Nirmala Sitharaman the best Finance Minister India has ever had and said,“No income tax till 12 lac. 5% and 12% GST.” However, the user said,“My only issue is with cars coming under 40% GST.”

Netizens wanted assurance that the tax cuts would be passed on to consumers .

“Now the question is, will the companies keep the rates as they are and pass on the lowered tax benefits to the customer?” a netizen asked.

Another asked,“Who is going to track if the tax cuts are passed on to consumers???? No one, right...”

One netizen said,“OR companies will cover up the relaxation of the final amount by increasing the commodity prices to earn profits?”

“Please ensure that this actually ends up reducing the price of products,” requested another.

Also Read | New GST Rates: When will changes in GST rates take effect? | Top FAQs answered

A user said that the Union government is aiming for a healthier India, and hence, the tax rates have been modified accordingly.

“On August 15th, the Prime Minister talked about increasing obesity in India. Today, in the GST Council meeting, sin goods like pan masala, gutka, and corbonated drinks were moved to 40% tax while healthy foods like Paneers have NO #GST. Let's make India healthy and strong,” said the user.

Some users were in utter shock upon realising the items they had been paying indirect taxes on. “Were we paying GST on freakin' rotis? @nsitharaman tayi, how have you managed to loot us for so long will be taught as a case study in the near future!” a user said.

Also Read | Can GST reforms drive Nifty 50, Sensex to a new peak by Diwali 2025?

Netizens also shared their views on the tax rate change on specific items.

“Slashing GST on Hotels & Gyms to bare minimum 5%, PM Modi Govt is sending out signals to middle class Indians to workout and travel more,” a user claimed.

An angry user said,“Another hypocritical & corrupt move by BJP !! So now Indians watching IPL match at stadium will have to pay 40% GST instead of earlier 28%, but BCCI, which earns 1000s of Crores from IPL & Tickets, will not even be taxed/pay tax. Watching IPL has now been made a luxury by the BJP gov.”

Also Read | GST Meeting LIVE: 'Reforms not linked to tariffs' - check old vs new rates here

A few users hailed the Opposition for making the reform possible, and said,“This GST reform would never have happened if Modi had won 400+ seats in the 2024 Parliament election. Thank you, people of India and the Opposition, for humbling and forcing him to work for the people by cutting his majority.”

“No Income tax upto 12L and now Lower GST rate with No GST on life and health insurance. 240 seats have done it in a year what 282 and 303 seats couldn't do in 10 yrs,” another added.

Here's what got cheaper:

1) Individual life and health insurance policies – to attract zero GST from 18%.

2) Ultra high temperature, paneer, paratha, roti, pizza bread, khakra and chena are exempt from GST. Butter, ghee, condensed milk, cheese, dry fruits, jams, jellies, confectionery, ice cream, pastry and biscuits, corn flakes, and cereals – to attract 5% GST from 12-18%.

3) Fertiliser inputs like sulphuric acid, nitric acid, and ammonia, along with biopesticides and micronutrients – to attract 5% GST from 12-18%.

4) Agricultural equipment, tractors, threshing, and soil-preparation machinery – to attract 5% GST from 12-18%.

5) Small cars (petrol <1200cc, diesel <1500cc) and motorcycles up to 350cc – to attract 18% GST instead of 28%. GST on EVs remains at 5%.

6) Everyday items like shampoo, toothpaste, toothbrushes, talcum powder, face powder, soaps, hair oil, tooth powder, feeding bottles, utensils, bicycles, umbrellas, and bamboo furniture – to attract 5% GST.

7) Cement, auto components – to attract 18% GST from 28%.

Also Read | GST Reforms: Net revenue implication is expected to be around ₹48,000 crore Here's what got costlier:

1) Soft drinks, colas, fruit-based aerated drinks, and all carbonated beverages – to attract 40% GST against 28%.

2) Energy drinks and other caffeinated beverages -- to face 40% GST.

3) Aerated waters and flavoured beverages containing added sugar or sweeteners – to face 40% GST.

4) Cars with petrol engines above 1200cc or diesel engines above 1500cc and longer than 4,000 mm, along with motorcycles above 350cc, racing cars, yachts, and personal-use aircraft – to face 40% GST.

5) Pan masala, gutkha, cigarettes, chewing tobacco, and bidi – to face 40% GST. But for now, they will continue under 28 per cent GST plus compensation cess until dues are repaid.

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