ICIM Hails Modi Government’s Next-Gen GST Reforms as Historic Move for Industry and Consumers

The Indian Council of Industrial Management (ICIM) has welcomed the landmark next-generation Goods and Services Tax (GST) reforms announced by the Modi Government, describing them as a transformative step towards simplicity, affordability, and inclusive growth.

ICIM Chairman, Satendra Singh, called the reforms-introducing a simplified two-slab GST structure of 5% and 18% while retaining a targeted 40% for select de-merit goods-the most significant overhaul since GST was first implemented.

"This reform package balances industry competitiveness with household relief. It creates a system that is easier to comply with, reduces costs for consumers, and fosters long-term growth for the economy," Singh said.

Key Highlights of the GST Reforms:

• Simplification: Tax slabs reduced from four to two, improving uniformity and compliance.
• Healthcare Relief: Life-saving drugs moved to NIL; other medicines and medical devices shifted to 5%.
• Insurance Boost: All individual life and health insurance policies made GST-exempt.
• Cheaper Essentials: UHT milk, paneer, and Indian breads at NIL; toiletries, bicycles, soaps, and kitchenware at 5%.
• Automobiles & Infrastructure: Small cars, two-wheelers, buses, ambulances, cement, and auto components at 18%.
• Service Sector Relief: Gyms, salons, yoga centres, and budget hotels at 5%.
• MSME & Export Support: Correction of inverted duty structures in textiles, fertilisers, and renewables; reforms aiding service exporters.

The new rates will be applicable from September 22, 2025, except for tobacco and pan masala, which remain under the existing cess until compensation obligations are settled.

Benefits for Industry

According to ICIM, the reforms are expected to:

• Lower compliance burdens with harmonised HSN codes.
• Reduce input costs for critical industries such as cement, textiles, autos, and renewables.
• Improve MSME cash flows by resolving inverted duty structures.
• Strengthen India's export competitiveness by addressing service taxation challenges.
• Ensure faster dispute resolution with the GST Appellate Tribunal, set to begin hearings in December 2025.

Relief for Citizens

The reforms also promise visible relief for households and individuals:

• Daily essentials and toiletries become cheaper.
• Affordable healthcare access through reduced medicine and device costs.
• Insurance coverage made more accessible with GST exemption.
• Lower transport costs for small cars, two-wheelers, and buses.
• Fitness and wellness services now within easier reach with just 5% GST.

ICIM's Role in Transition

To support industries during the transition, ICIM will publish an HSN-wise rate guide, conduct sector-specific webinars, and set up compliance helpdesks to assist businesses before the September 22 rollout.

Concluding, Chairman Singh said:

"The next-gen GST reforms are a bold stride in India's economic journey. They cut costs, enhance compliance, and put the aam aadmi at the centre of change. ICIM is committed to guiding industries and professionals through this transition for a stronger, growth-driven Bharat."

For media enquiries:
Indian Council of Industrial Management (ICIM)
Email: info@icim.in