What is GST Rate System in India?
India’s tax landscape changed fundamentally in July 2017 when the Goods and Services Tax replaced a complicated web of central and state levies, including VAT, excise duty, and service tax, with a single unified indirect tax system. At the heart of this system are the GST rates in India, which determine how much tax is charged on the sale of any good or service. These rates are decided by the GST Council, a joint body comprising the Union Finance Minister and state finance ministers, which meets periodically to revise the GST slab structure based on economic conditions, industry feedback, and revenue requirements.
The GST slab system currently categorises goods and services into multiple tax brackets, ranging from 0% on essential daily necessities to higher rates on luxury and demerit goods. In 2025, the framework underwent its most significant revision since launch, with reforms effective from 22 September 2025, introducing what is now referred to as GST 2.0. Under this updated structure, the GST rates in India have been rationalised to reduce complexity, lower the tax burden on essentials, and improve compliance efficiency. Understanding these rates is no longer just a regulatory requirement for businesses, as it directly shapes pricing decisions, input tax credit planning, and cash flow management.
Updated GST Rates in India 2026
India’s Goods and Services Tax (GST) is one of the most significant indirect tax reforms in the country’s history. Introduced in July 2017, it replaced a fragmented system of state and central levies, including VAT, excise duty, service tax, and entertainment tax, with a single, unified tax framework applicable across all states and union territories. Understanding the current GST rates in India is essential for every business owner, tax professional, accountant, and consumer. The applicable GST slab not only determines how much tax is charged on a product or service but also influences pricing decisions, input tax credit (ITC) eligibility, cash flow planning, and overall compliance costs.
The GST rates in India are governed by the GST Council, a joint body comprising the Union Finance Minister and state finance ministers. The Council meets periodically to review the tax structure, rationalise GST slab categories, and introduce changes aligned with economic priorities. In 2025, a landmark revision under the 56th GST Council meeting introduced what is now referred to as GST 2.0. Effective from 22 September 2025, the new framework simplifies the overall slab structure, reduces compliance burdens, and shifts several essential goods to lower or nil GST rate categories. These updated GST rates in India continue to govern taxation in 2026.
| GST Rate | Category | Examples |
| 0% (Nil Rate) | Essential goods & services | Fresh fruits & vegetables, milk, education services, healthcare services, life-saving drugs |
| 5% | Mass consumption & daily-use items | Packaged food, household essentials (soap, toothpaste), footwear (low-value), agricultural goods |
| 18% | Standard rate (majority of goods/services) | Electronics, restaurants, telecom services, automobiles (small cars), construction materials |
| 40% | Luxury & sin goods | Tobacco, aerated drinks, luxury cars, high-end motorcycles, betting/gambling services |
| 3% | Special rate for precious metals | Gold, gold jewellery, gold bullion, platinum |
| 0.25% | Special rate for precious stones | Rough diamonds, unprocessed precious stones |
Item-Wise GST Rate List in India 2026
The following is a comprehensive item-wise GST rate list for 2026. This covers key categories including food and agriculture, healthcare, education, electronics, automobiles, services, textiles, construction, and luxury goods. The GST rates listed here reflect the latest GST rates in India as updated under the GST 2.0 framework and subsequent notifications.
| Category | Item / Product or Service | Previous GST Rate | New GST Rate (2026) |
| 0% Slab – Nil / Exempt | Individual life and health insurance policies | 18% | 0% (Exempt) |
| 0% Slab – Nil / Exempt | All Indian breads (roti, paratha, parotta, chapati, etc.) | 5% | 0% (Exempt) |
| 0% Slab – Nil / Exempt | Pre-packaged and labelled paneer | 5% | 0% (Exempt) |
| 0% Slab – Nil / Exempt | Pencils, sharpeners, erasers, crayons, and notebooks | 5% or 12% | 0% (Exempt) |
| 0% Slab – Nil / Exempt | Maps, charts, and globes | 12% | 0% (Exempt) |
| 0% Slab – Nil / Exempt | Select life-saving cancer medications (notified) | 5% or 12% | 0% (Exempt) |
| 0% Slab – Nil / Exempt | Unbranded milk, eggs, curd, and lassi | 0% | 0% (Exempt) |
| 0% Slab – Nil / Exempt | Unpacked foodgrains, atta, maida, and besan | 0% | 0% (Exempt) |
| 0% Slab – Nil / Exempt | Fresh vegetables and fruits | 0% | 0% (Exempt) |
| 0% Slab – Nil / Exempt | Educational and healthcare services | 0% | 0% (Exempt) |
| 0% Slab – Nil / Exempt | Goods sold at Indo-Bangladesh border haats | Varied | 0% (Exempt) |
| 0% Slab – Nil / Exempt | Vehicles retrofitted for persons with disabilities | ~12% | 5% |
| 5% Slab | Hair oil, shampoo, soap, toothpaste | 18% | 5% |
| 5% Slab | Butter, ghee, cheese, and dairy spreads | 12% | 5% |
| 5% Slab | Packaged food items (namkeen, biscuits, pasta, cornflakes, cereals) | 12% or 18% | 5% |
| 5% Slab | Utensils, bicycles, and kitchenware | 12% or 18% | 5% |
| 5% Slab | Apparel priced up to ₹2,500 | 12% | 5% |
| 5% Slab | Footwear priced up to ₹2,500 | 12% | 5% |
| 5% Slab | Jams, sauces, pickles, and soups | 12% or 18% | 5% |
| 5% Slab | Dry fruits and nuts (almonds, cashews, etc.) | 12% | 5% |
| 5% Slab | Fruit juices, packed coconut water | 12% | 5% |
| 5% Slab | Diagnostic kits and reagents | 12% or 18% | 5% |
| 5% Slab | Surgical instruments and thermometers | 18% | 5% |
| 5% Slab | Services at salons, gyms, and yoga centres | 18% | 5% |
| 5% Slab | Hotel stays with tariff between ₹1,000 and ₹7,500 | 12% | 5% |
| 5% Slab | Fertilizers and agricultural machinery | 12% or 18% | 5% |
| 5% Slab | Spectacles and corrective goggles | 28% | 5% |
| 5% Slab | Life-saving medicines (excluding those fully exempted) | 12% | 5% |
| 5% Slab | Pens | 12% | 5% |
| 5% Slab | Packaging containers and boxes | 12% | 5% |
| 5% Slab | Railway goods and parts (Chapter 86) | 12% | 5% |
| 5% Slab | Certain renewable energy devices | 12% | 5% |
| 5% Slab | Printed materials and reproduction of recorded media | 12% | 5% |
| 18% Slab | Air conditioners, televisions (all sizes), refrigerators, washing machines, dishwashers | 28% | 18% |
| 18% Slab | Small cars (petrol under 1200cc / diesel under 1500cc / length under 4 metres) | 28% + cess | 18% |
| 18% Slab | Motorcycles (engine capacity up to 350cc) | 28% + cess | 18% |
| 18% Slab | Commercial vehicles (buses, trucks, three-wheelers, ambulances) | 28% | 18% |
| 18% Slab | Auto parts and components (all categories) | 28% | 18% |
| 18% Slab | Cement | 28% | 18% |
| 18% Slab | All types of batteries | 28% | 18% |
| 18% Slab | Road tractors (engine capacity above 1800cc for semi-trailers) | 28% | 18% |
| 18% Slab | Printers and computers | 18% | 18% (Unchanged) |
| 18% Slab | Mobile phones | 18% | 18% (Unchanged) |
| 18% Slab | Capital goods and industrial intermediate goods | 18% | 18% (Unchanged) |
| 18% Slab | Telecom, banking, and IT services | 18% | 18% (Unchanged) |
| 40% Slab | Luxury and premium cars | 28% + up to 22% cess (up to 50%) | 40% |
| 40% Slab | Motorcycles (engine capacity above 350cc) | 28% + 3% cess (31%) | 40% |
| 40% Slab | Aerated and carbonated beverages | 28% + 12% cess (40%) | 40% |
| 40% Slab | Yachts and personal aircraft | 28% + applicable cess | 40% |
| 40% Slab | Revolvers and pistols | 28% + applicable cess | 40% |
| 40% Slab | Betting, online gaming, and casinos | 28% | 40% |
| 40% Slab | Admission to sports events (e.g., IPL) | 28% | 40% |
| 28% + Cess(Transitional) | Tobacco, cigarettes, pan masala, gutkha, and related products | 28% + Cess | 28% + Cess (shifting to 40% post-compensation loan repayment) |
| 3% Slab | Gold, silver, platinum | 3% | 3% (Unchanged) |
| 3% Slab | Imitation jewellery and items coated with precious metals | 3% | 3% (Unchanged) |
| 3% Slab | Natural or cultured pearls (unstrung/unmounted) | 3% | 3% (Unchanged) |
| 3% Slab | Worked diamonds (non-industrial, not mounted or set) | 3% | 3% (Unchanged) |
| 3% Slab | Precious and semi-precious stones (excluding diamonds) | 3% | 3% (Unchanged) |
| 3% Slab | Waste or scrap of precious metals | 3% | 3% (Unchanged) |
| 0.25% Slab | Non-industrial grade diamonds | 0.25% | 0.25% (Unchanged) |
| 0.25% Slab | Unprocessed precious or semi-precious stones | 0.25% | 0.25% (Unchanged) |
| 0.25% Slab | Synthetic or reconstructed precious or semi-precious stones | 0.25% | 0.25% (Unchanged) |
Recent GST Rate Changes and Notifications
The GST Council has made several significant revisions to GST rates in India over the past two years. The most comprehensive overhaul was introduced through the 56th GST Council meeting, with effect from 22 September 2025. The following table summarises the key GST rate changes and the notifications under which they were introduced.
| Item / Category | Previous GST Rate | New GST Rate(Effective 22 Sept 2025) | CBIC Notification Number | Notification Date | Nature of Change |
| REDUCED TO 0% (NIL / EXEMPT) | |||||
| All individual life insurance policies (term life, ULIP, endowment) and reinsurance thereof | 18% | 0% (Exempt) | No. 16/2025 – Central Tax (Rate) | 17 Sept 2025 | Exempted |
| Individual health insurance policies (including family floater and senior citizen plans) | 18% | 0% (Exempt) | No. 16/2025 – Central Tax (Rate) | 17 Sept 2025 | Exempted |
| All Indian breads (roti, paratha, parotta, chapati, khakhra, pizza bread) | 5% | 0% (Exempt) | No. 10/2025 – Central Tax (Rate) | 17 Sept 2025 | Exempted |
| Pre-packaged and labelled paneer (chena) | 5% | 0% (Exempt) | No. 10/2025 – Central Tax (Rate) | 17 Sept 2025 | Exempted |
| Pencils, sharpeners, erasers, crayons, and notebooks | 5% or 12% | 0% (Exempt) | No. 10/2025 – Central Tax (Rate) | 17 Sept 2025 | Exempted |
| Maps, charts, and globes | 12% | 0% (Exempt) | No. 10/2025 – Central Tax (Rate) | 17 Sept 2025 | Exempted |
| Select life-saving cancer and rare disease medications (notified list) | 5% or 12% | 0% (Exempt) | No. 10/2025 – Central Tax (Rate) | 17 Sept 2025 | Exempted |
| Goods sold at Indo-Bangladesh border haats (IGST exemption) | Varied | 0% (IGST Exempt) | No. 9/2025 – Integrated Tax (Rate) | 17 Sept 2025 | Exempted |
| Vehicles retrofitted for persons with disabilities | ~12% | 5% | No. 9/2025 – Central Tax (Rate) | 17 Sept 2025 | Rate Reduced |
| REDUCED FROM 18% TO 5% | |||||
| Hair oil, shampoo, soap, and toothpaste | 18% | 5% | No. 9/2025 – Central Tax (Rate) | 17 Sept 2025 | Rate Reduced |
| Surgical instruments and thermometers | 18% | 5% | No. 9/2025 – Central Tax (Rate) | 17 Sept 2025 | Rate Reduced |
| Services at salons, gyms, and yoga centres | 18% | 5% | No. 15/2025 – Central Tax (Rate) | 17 Sept 2025 | Rate Reduced |
| Fertilizers and agricultural machinery | 12% or 18% | 5% | No. 9/2025 – Central Tax (Rate) | 17 Sept 2025 | Rate Reduced |
| Spectacles and corrective goggles | 28% | 5% | No. 9/2025 – Central Tax (Rate) | 17 Sept 2025 | Rate Reduced |
| REDUCED FROM 12% TO 5% | |||||
| Butter, ghee, cheese, and dairy spreads | 12% | 5% | No. 9/2025 – Central Tax (Rate) | 17 Sept 2025 | Rate Reduced |
| Packaged food items (namkeen, biscuits, pasta, cornflakes, cereals) | 12% or 18% | 5% | No. 9/2025 – Central Tax (Rate) | 17 Sept 2025 | Rate Reduced |
| Dry fruits and nuts (almonds, cashews, etc.) | 12% | 5% | No. 9/2025 – Central Tax (Rate) | 17 Sept 2025 | Rate Reduced |
| Fruit juices and packed coconut water | 12% | 5% | No. 9/2025 – Central Tax (Rate) | 17 Sept 2025 | Rate Reduced |
| Jams, sauces, pickles, soups | 12% or 18% | 5% | No. 9/2025 – Central Tax (Rate) | 17 Sept 2025 | Rate Reduced |
| Utensils, bicycles, and kitchenware | 12% or 18% | 5% | No. 9/2025 – Central Tax (Rate) | 17 Sept 2025 | Rate Reduced |
| Apparel priced up to ₹2,500 | 12% | 5% | No. 9/2025 – Central Tax (Rate) | 17 Sept 2025 | Rate Reduced |
| Footwear priced up to ₹2,500 | 12% | 5% | No. 9/2025 – Central Tax (Rate) | 17 Sept 2025 | Rate Reduced |
| Hotel stays with tariff between ₹1,000 and ₹7,500 per night | 12% | 5% | No. 15/2025 – Central Tax (Rate) | 17 Sept 2025 | Rate Reduced |
| Life-saving medicines (excluding fully exempted category) | 12% | 5% | No. 9/2025 – Central Tax (Rate) | 17 Sept 2025 | Rate Reduced |
| Diagnostic kits and reagents | 12% or 18% | 5% | No. 9/2025 – Central Tax (Rate) | 17 Sept 2025 | Rate Reduced |
| Pens, packaging containers, printed materials | 12% | 5% | No. 9/2025 – Central Tax (Rate) | 17 Sept 2025 | Rate Reduced |
| Railway goods and parts (Chapter 86); certain renewable energy devices | 12% | 5% | No. 9/2025 – Central Tax (Rate) | 17 Sept 2025 | Rate Reduced |
| REDUCED FROM 28% TO 18% | |||||
| Air conditioners, televisions (all sizes), refrigerators, washing machines, dishwashers | 28% | 18% | No. 9/2025 – Central Tax (Rate) | 17 Sept 2025 | Rate Reduced |
| Small cars (petrol under 1200cc / diesel under 1500cc / under 4 metres) | 28% + 1% to 3% cess | 18% | No. 9/2025 – Central Tax (Rate) + No. 2/2025 – Compensation Cess (Rate) | 17 Sept 2025 | Rate Reduced + Cess Removed |
| Motorcycles up to 350cc | 28% + cess | 18% | No. 9/2025 – Central Tax (Rate) + No. 2/2025 – Compensation Cess (Rate) | 17 Sept 2025 | Rate Reduced + Cess Removed |
| Commercial vehicles (buses, trucks, three-wheelers, ambulances) | 28% | 18% | No. 9/2025 – Central Tax (Rate) | 17 Sept 2025 | Rate Reduced |
| Auto parts and components (all categories) | 28% | 18% | No. 9/2025 – Central Tax (Rate) | 17 Sept 2025 | Rate Reduced |
| Cement | 28% | 18% | No. 9/2025 – Central Tax (Rate) | 17 Sept 2025 | Rate Reduced |
| All types of batteries; road tractors above 1800cc | 28% | 18% | No. 9/2025 – Central Tax (Rate) | 17 Sept 2025 | Rate Reduced |
| Spectacles (moved from 28% to 5% – see above) | 28% | 5% | No. 9/2025 – Central Tax (Rate) | 17 Sept 2025 | Rate Reduced |
| NEW 40% SLAB – LUXURY AND SIN GOODS (REPLACES 28% + CESS) | |||||
| Luxury and premium cars | 28% + up to 22% cess (up to 50% total) | 40% | No. 9/2025 – Central Tax (Rate) + No. 2/2025 – Compensation Cess (Rate) | 17 Sept 2025 | Restructured to 40% |
| Motorcycles above 350cc | 28% + 3% cess (31% total) | 40% | No. 9/2025 – Central Tax (Rate) + No. 2/2025 – Compensation Cess (Rate) | 17 Sept 2025 | Restructured to 40% |
| Aerated and carbonated beverages | 28% + 12% cess (40% total) | 40% | No. 9/2025 – Central Tax (Rate) + No. 2/2025 – Compensation Cess (Rate) | 17 Sept 2025 | Restructured to 40% |
| Yachts and personal aircraft | 28% + cess | 40% | No. 9/2025 – Central Tax (Rate) | 17 Sept 2025 | Restructured to 40% |
| Revolvers and pistols | 28% + cess | 40% | No. 9/2025 – Central Tax (Rate) | 17 Sept 2025 | Restructured to 40% |
| Betting, online gaming, and casinos | 28% | 40% | No. 15/2025 – Central Tax (Rate) | 17 Sept 2025 | Rate Increased |
| Admission to sports events (e.g., IPL) | 28% | 40% | No. 15/2025 – Central Tax (Rate) | 17 Sept 2025 | Rate Increased |
| PENDING TRANSITION TO 40% (RATE UNCHANGED FOR NOW) | |||||
| Tobacco, cigarettes, pan masala, gutkha, chewing tobacco, bidi | 28% + Compensation Cess | 28% + Compensation Cess (will shift to 40% post-loan repayment) | To be notified separately by the Finance Minister after compensation loan discharge | Date TBD | Transitional |
| COMPLIANCE AND PROCEDURAL CHANGES | |||||
| E-commerce operator: local delivery services by unregistered suppliers | Varied | 18% | No. 15/2025 – Central Tax (Rate) | 17 Sept 2025 | New Levy |
| GSTR-9/9A annual return waived for taxpayers with turnover up to Rs. 2 crore | Mandatory | Waived from FY 2024-25 onwards | No. 13/2025 – Central Tax | 17 Sept 2025 | Compliance Relief |
| 90% provisional refund on inverted duty structure (system-based, risk-evaluated) | Manual process | System-run from 1 November 2025 | No. 14/2025 – Central Tax | 17 Sept 2025 | Process Change |
| HSN code reporting: 4-digit for turnover up to Rs. 5 crore; 6-digit above | Less strict | Mandatory dropdown on GST portal from May 2025 | CBIC Advisory / Portal Update | May 2025 | Compliance Update |
Conclusion
Understanding the GST rates in India 2026 is essential for consumers, businesses, and professionals. The new GST rate list introduced in 2025 and effective in 2026 has simplified the tax structure, lowered the burden on essentials, and kept revenue stable through targeted higher rates on luxury goods. Whether you are purchasing everyday products or managing a business, staying informed about the latest GST percentages helps with better planning and compliance.
At LendingKart, we keep a close eye on regulatory changes like these because they impact business costs and opportunities. GST plays a crucial role in shaping the economic environment in which businesses operate, and a better understanding of it can help you make more informed financial decisions.
FAQ’s
1. How many GST slabs are there in India currently?
As per the updated structure effective September 2025, India currently has four primary GST slabs under the simplified system introduced by the GST Council:
- 0% (Nil rate) for essential goods
- 5% for mass-consumption items
- 18% as the standard rate for most goods and services
- 40% for luxury and sin goods
Additionally, special rates like 3% and 0.25% apply to specific categories such as precious metals.
2. What is the highest GST rate in India in 2026?
The highest GST rate in India in 2026 is 40%, introduced under GST 2.0 following the 56th GST Council meeting. This rate applies to select luxury and demerit goods as officially notified. Before GST 2.0, the highest standard GST slab was 28%, which continues to apply to several goods, including tobacco, cement, and premium automobiles, sometimes with an additional compensation cess on top.
3. What are the different types of GST in India?
GST in India is structured into four types. CGST (Central Goods and Services Tax) is collected by the central government on intra-state transactions. SGST (State Goods and Services Tax) is collected by the respective state government on the same intra-state transactions, with CGST and SGST each being half of the applicable GST rate. IGST (Integrated Goods and Services Tax) is levied on inter-state transactions and imports, and is collected entirely by the central government before being distributed. UTGST (Union Territory Goods and Services Tax) applies in place of SGST in union territories without a legislature, such as Chandigarh and Dadra and Nagar Haveli.
4. Who decides GST rates in India?
GST rates in India are decided by the GST Council, a constitutional body established under Article 279A of the Indian Constitution. The Council is chaired by the Union Finance Minister and includes the finance ministers of all states and union territories. It meets periodically to review the GST slab structure, approve rate changes, and issue recommendations that are then notified through official CBIC circulars and Central Tax (Rate) Notifications in the Official Gazette.
5. Can GST rates in India change during a financial year?
Yes, GST rates in India can be revised at any point during a financial year. The GST Council meets as frequently as required, and its rate change recommendations take effect from the date specified in the official government notification, not necessarily from the start of a financial year. The GST 2.0 changes, for example, came into effect on 22 September 2025, mid-financial year. Businesses must monitor CBIC notifications and update their invoicing and compliance systems from the notified effective date to avoid errors and penalties.
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