GST · Registration and basics
What are the GST rates after 22 September 2025?
Short answer
From 22 September 2025, most goods and services fall in two slabs, 5% and 18%, with a 40% rate for a short list of luxury and demerit goods and nil for exempt items. The 12% and 28% slabs were removed. Special rates such as 3% on gold continue. The GST Council made no rate change at its meeting on 8 October 2026. Always check the notified rate for your item's HSN or SAC code.
The structure
| Rate | What it covers, broadly |
|---|---|
| Nil | Exempt essentials, such as fresh food items, and services such as individual life and health insurance |
| 5% | Many everyday goods and services moved down from 12% and 18% |
| 18% | The standard rate: most goods and services, including most items earlier at 28%, such as small cars, motorcycles up to 350 cc, air conditioners and cement |
| 40% | A short list of luxury and demerit goods, such as pan masala, aerated and sugared drinks, larger cars and motorcycles above 350 cc |
| Special rates | 3% on gold and silver, 0.25% on rough diamonds, and others as notified |
Compensation cess was removed on most goods; it continued for tobacco products for a transitional period.
What to check in your business
- Classification. Find the HSN or SAC for each item and read the notified rate; do not assume an item moved with its old slab.
- Billing software and price lists. Update rate masters, and check whether prices are inclusive or exclusive of tax.
- Supplies across the change date. The time of supply decides which rate applies.
- Credit and refunds. If your inputs are now taxed higher than your output, check whether an inverted duty refund is available.
- Contracts. Check who bears the effect of the rate change on long-term contracts.
Is anything changing next?
At its 57th meeting on 8 October 2026 the GST Council recommended no rate change, and said rate matters will be taken up once a year at a dedicated meeting. Its other recommendations (on penalties, refunds and credit) take effect only when notified.
Read the guide on GST rates after 22 September 2025, and add or remove GST at any rate with the GST calculator.
Legal basis
- Sections 9 and 11, CGST Act, 2017; section 5, IGST Act, 2017
- Rate notifications issued from 17 September 2025 on the recommendations of the 56th GST Council meeting (3 September 2025)
Official sources
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