Since the introduction of Goods and Services Tax (GST), India’s tax system has become simpler and more uniform. Every year, the government updates GST rates on various goods and services to keep them aligned with inflation and economic needs.
In this blog, we’ll cover the GST New Rate List 2025 so you can stay updated on how much tax applies to different products and services.
GST Rate Slabs 2025
India primarily has four GST rate slabs:
| GST Slab | Tax Rate | Examples |
|---|---|---|
| 5% | Lower Rate | Daily essentials – packaged food, books, train/bus travel |
| 12% | Mid Rate | Processed food, restaurants (non-AC), hotels (₹1000 – ₹7500 room tariff) |
| 18% | Standard Rate | Most goods and services, AC restaurants, professional services |
| 28% | High Rate | Luxury items, cars, tobacco, premium products |
Key Changes in GST Rates for 2025
The government has made a few major updates in 2025 to support businesses and consumers:
Electric Vehicles (EVs) – Reduced from 5% to 3%
Hospitality Sector – Hotel rooms with tariff between ₹1000 and ₹2000 now taxed at 5% (previously 12%)
Packed Milk and Dairy Products – Made GST Free
Cigarettes & Tobacco Products – 28% + additional cess (increased)
E-commerce Services – Increased from 18% to 20%
Impact on Businesses and Consumers
Consumers – Prices of daily items will become cheaper (especially dairy products and hotel stays)
Business Owners – EV dealers, hotel industry, and FMCG sector will benefit the most
Health Sector – Higher tax on tobacco expected to reduce consumption
Why It’s Important to Know GST Rates
For accurate invoicing and tax calculation
To claim Input Tax Credit (ITC) properly
To set the right pricing for products and services
