India Implements New Two-Tier GST Regime Amidst Political Debate
India's new two-tier Goods and Services Tax (GST) regime, featuring rates of 5% and 18% (with 40% for ultra-luxury items), became effective on September 22, 2025. Prime Minister Narendra Modi hailed it as a "GST savings festival" and a step towards economic self-reliance, anticipating βΉ2.5 lakh crore in household savings. Finance Minister Nirmala Sitharaman highlighted its benefits for the poor, middle class, and MSMEs. The BJP plans a nationwide campaign to promote these reforms. However, opposition parties, including the Congress, deemed the reforms inadequate, criticizing Modi for claiming sole ownership and demanding a more comprehensive "GST 2.0" to address unresolved sectoral issues and extend state compensation.