Tax system will become transparent due to reduction in GST, these sectors will get a boost

FICCI has welcomed the GST 2.0 reforms. The organization says that this will bring transparency in the tax system, provide relief to consumers and MSMEs and resolve the inverted duty structure.

The Federation of Indian Chambers of Commerce and Industry (FICCI) has welcomed the new reforms made by the GST Council. The organization said that these reforms will bring transparency, stability and predictability in India’s tax system. According to FICCI, this new two-tier GST framework (GST 2.0), which will be implemented from 22 September 2025, will greatly benefit labor-intensive industries, families and consumption-based growth.

Solution to inverted duty structure

FICCI said that under GST 2.0 reforms, the inverted duty structure in the textile, fertilizer and renewable energy sector has been corrected. This will reduce dependence on imports and increase the competitiveness of Indian products in the global market.

Impact on domestic budget

Reducing tax rates on FMCG products such as soap, shampoo, toothpaste, hair oil and packaged food will directly provide relief to consumers. This will ease the domestic budget and increase consumption.

Benefit to farmers and rural economy

Reducing taxes on agricultural goods will reduce the cost of farmers. This will improve rural income and strengthen food security.

Support to industries and MSMEs

Tax relief has been given to labor-intensive sectors such as handicrafts, textiles, leather, shoes, toys and marble. This will strengthen MSMEs, save traditional employment and also create new employment opportunities.

Boost to infrastructure and housing sector

FICCI believes that lower GST on cement, renewable energy devices and construction materials will give impetus to housing and infrastructure projects. This move will support the government’s vision of housing for all.

Statement of FICCI President

FICCI President Harsh Vardhan Agarwal said that these reforms will reduce disputes related to classification and make compliance easier. However, he also admitted that the reduction in tax rates will affect the government’s revenue, but it will increase demand and also control inflation.

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