GST 2.0 refers to the proposed simplification of India's GST structure from 4 slabs (5%, 12%, 18%, 28%) to 3 slabs (5%, 18%, and a new 40% luxury rate). It aims to reduce classification disputes and improve compliance.

What are the new GST 2.0 rates?

Under GST 2.0, the proposed rates are: 5% for essentials, 18% for standard goods & services, and 40% for luxury items like premium automobiles and high-end electronics. The existing 12% and 28% slabs would be absorbed into these three.

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The GST 2.0 Resource Center

India's transition to the simplified 3-slab GST structure (5%, 18%, 40%) brings major changes to compliance, invoicing, and ITC. Find all the tools and guides you need to adapt.

Essential GST 2.0 Tools

GST 2.0 Calculator

Updated

Calculate exact tax amounts using the new 5%, 18%, and 40% slabs. Instantly split CGST/SGST or reverse-calculate from MRP.

Old vs New Rate Checker

Compare the tax impact on your products. See how the transition from 12% to 18% or 28% to 40% affects your working capital.

MRP Revision Calculator

Reverse-calculate your new MRP after a GST rate change. Automatically preserves your exact profit margin.

ITC Reversal Checker

A decision-tree tool to determine if a GST rate drop on your product legally requires you to surrender Input Tax Credit.

In-Depth Guides & Analysis

GST 2.0 New Rates (Complete List)

A comprehensive breakdown of which items moved to 5%, 18%, and the new 40% luxury slab.

Understanding the 40% Luxury Slab

What qualifies as "luxury"? How the 40% rate impacts automobiles, high-end electronics, and real estate.

How to Handle MRP Revisions

Legal requirements for restickering inventory and declaring new MRPs after rate changes.

ITC Reversals on Rate Drops

Step-by-step guide on how to handle Input Tax Credit when your product's GST rate decreases.

Product-wise Rate Changes

A product-by-product listing of all items affected by the GST 2.0 rate revision.

Post-Sale Discounts Under GST 2.0

How trade discounts, rebates, and dealer incentives are treated after a rate change under GST.

Frequently Asked Questions

What is GST 2.0?

GST 2.0 refers to the rationalisation of India's GST rate structure that came into effect on 22 September 2025. It consolidated the old 4 slabs (5%, 12%, 18%, 28%) down to 3 slabs: 5% for essentials, 18% for standard goods and services, and a new 40% slab for luxury items. The previous 12% and 28% slabs were merged into 18% or 40% respectively. This reduced classification disputes and improved overall compliance.

Which products will now fall under the 40% GST slab?

The 40% slab applies to luxury goods previously taxed at the highest rates. This includes premium and large-engine automobiles, aerated drinks (which carry a cess in addition), tobacco products, and high-end consumer electronics. The complete list was notified by the GST Council upon implementation in September 2025.