GST 2.0 tax cuts kick in: What you need to know and how to avoid overpaying

To avoid confusion and ensure you’re not overpaying, it’s a good idea to double-check product prices, especially the MRP, before you pay at checkout.

One key change is that manufacturers and retailers can now stick updated price tags on items produced before September 22. However, the old price will still be visible, meaning you could see two price tags—one with the original price and one with the new, updated price.

For example, imagine you are buying a shampoo bottle that used to cost Rs 200. With the new GST revision, the price could drop to Rs 190, but if the shop hasn’t updated the price yet, you could still be charged Rs 200. In the past, businesses had to advertise the updated prices in newspapers, but that rule has now been scrapped. Instead, businesses are only required to send updated price lists to dealers and retailers, which means not every store will have received the changes in time. So, you could end up paying more than necessary if you’re not careful.

• Check the new MRP: Always verify the updated price on the product before buying.

• Match the bill: Make sure the price on your receipt matches the price on the item.

• Be extra cautious: Small or independent stores may take longer to update their prices, so pay extra attention when shopping there.

The Department of Consumer Affairs issued a new advisory on September 18, 2025, outlining the updated rules for pricing. The advisory clarifies that manufacturers and importers must add new price stickers on unsold products, but the original price can’t be hidden. Also, the requirement to publish price changes in two newspapers has been waived. Now, updated prices need to be sent to wholesale dealers and retailers, and manufacturers must inform everyone—from retailers to consumers—through various communication channels, including social media.

What’s cheaper under GST 2.0?

Prime Minister Narendra Modi, in his Sunday speech, called the new reforms a “GST Bachat Utsav” or GST Savings Festival.

Here’s a quick look at what’s becoming cheaper:

• Medicines: Tax dropped from 12% to 5%. Plus, 36 critical life-saving drugs will be fully exempt from GST.

• Medical Devices: Reduced to 5% GST.

• Common Items: Goods like ghee, butter, dry fruits, ice creams, and even TV sets will become cheaper.

• Cement: GST slashed from 28% to 18%.

• Cars: Small cars will now have a tax of 18%, while big cars will be taxed at 28%.

• Household Items: Products like air conditioners, washing machines, soaps, and shampoos will see price reductions as taxes fall to 5%.