Himanshu Sinha, Trilegal, Provides Insights on GST 2.0 Reforms and Their Economic Impact
The leading law firm in India, Trilegal, shares insights from Himanshu Sinha (Partner – Tax Practice), on the recent GST announcement by the 56th GST Council Meeting, emphasizing the impact of the reforms across sectors and the broader economy.
Key Highlights of GST 2.0 Reforms
“The 56th GST Council Meeting has ushered in a landmark tax reform, implementing a predominantly two-tier GST structure (5% merit rate, 18% standard rate) effective 22 September 2025, along with a special de-merit rate of 40% for select goods and services. This pivotal move aims to rationalize the tax regime, stimulate consumption, and bolster economic growth,” said Himanshu Sinha.
Reductions in Key Sectors
He added, “Significant reductions include essential household goods decreasing from 18% to 5%, and cement from 28% to 18%, providing considerable relief to consumers and the infrastructure sector. Additionally, individual life and health insurance policies now receive a complete GST exemption. The applicable rate for renewable energy devices and parts for their manufacture is proposed to be reduced to 5%.”
Boosting Manufacturing and Exports
“Measures to enhance manufacturing competitiveness and exports, such as correcting inverted duty structures in textiles and resolving intermediary service disputes through IGST Act amendments, will benefit sectors like IT and consulting. At the same time, the applicable rates for inward supplies for petroleum operations have been increased. Overall, this comprehensive ₹48,000 crore reform package, paired with the income tax benefits in this year’s budget, is strategically designed to drive consumption and foster a more dynamic economic environment,” he concluded.
Overall, experts believe that the GST 2.0 reforms will simplify compliance, reduce disputes, and lower the tax burden across key sectors while stimulating consumption-led growth. With these measures, the government aims to create a more dynamic and investment-friendly economic environment, benefiting both businesses and consumers across India.
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