New CGST rates, Effective From 22-sept-2025

Under the new framework, Schedule 1 items will be subject to a 2.5 percent CGST. This means that these items will be subject to a 5 percent GST along with the State GST.
On Wednesday, the government notified the revised list of Central Goods and Services Tax (CGST) rates, which will replace the original rates applicable since 2017. The Finance Ministry issued this notification, which will come into effect from September 22.

These changes have been made to seven schedules, in which CGST rates are notified at 2.5, 9, 20, 1.5, 0.125, 0.75, and 14 percent. It is noteworthy that state governments will issue separate notifications for State GST (SGST) at these rates.

Under the new framework,

• Schedule 1 items will attract a 2.5% central GST, which means that these items will attract a 5% GST along with the state GST, as both governments levy the same tax. This schedule includes essential commodities and primary goods, ranging from dairy products such as milk powder, yogurt, butter, and ghee to packaged cereals and coarse grains such as rice, wheat, and pulses. These include spices, tea, coffee, nuts, honey, edible oils, medicines, fertilizers, soap, toothpaste, incense sticks, and a wide range of renewable energy equipment such as solar panels, windmills, and biogas plants.
• Schedule 2 items will attract a 9% CGST (effectively 18% GST). Such items include industrial inputs, intermediate goods, textiles, and consumer goods.
• Schedule 3 Items will attract a 20% CGST, bringing the total GST on such items to 40%. This schedule includes luxury and harmful goods such as aerated beverages and energy drinks, expensive cars and SUVs, hybrid vehicles with engine capacity exceeding a certain limit, motorcycles with engine capacity exceeding 350 cc, aircraft for personal use, yachts, revolvers and pistols. It also includes actionable claims through betting, casinos, horse racing, lotteries and online money gaming.
• 1.5% CGST (3% GST) is levied on Schedule 4, which includes pearls, gold, silver and jewellery.
• 0.75% (1.5% GST) is levied on Schedule 6, which includes certain specified inputs
• 14% CGST (28% GST) is levied on Schedule 7, which includes tobacco-related products.