Benefits of GST Rate Reduction to the Common Public

Benefits of GST Rate Reduction to the Common Public

The article reports that the common people of India have benefited significantly from the government’s recent rate rationalization under the Goods and Services Tax (GST) regime, which was primarily achieved through cuts on various goods and services.

Key Ways People Have Benefited

• Increased Affordability: The reduction in GST rates on numerous essential and daily-use items, often moved from 18% or 12% down to 5%, has directly lowered their retail prices. This improves the purchasing power of the average consumer.
• Lower Healthcare Costs: The removal of GST on individual health and life insurance policies and the reduction of GST on many medicines and health products make healthcare and financial security more affordable for families.
• Boost to Consumption and Savings: The price reduction on goods ranging from food items (like nuts and processed foods) to consumer durables (like small cars and two-wheelers) has spurred demand. Consumers either spend less on the same quantity or buy more for the same price, leading to enhanced perceived savings.
• Support for Local Livelihoods: The tax cuts provide indirect benefits to consumers by stabilizing and supporting local economies. The reduced tax burden on products from sectors like handicrafts, textiles, and local agro-processing helps sustain the livelihoods of artisans and small producers, ensuring the continuous supply of affordable goods.