GST 2.0, effective from September 22, 2025, marks India’s largest tax overhaul, introducing major price reductions, a simplified tax structure, and new opportunities for exporters and international buyers. Panoramic Sourcing empowers global clients to maximize these savings across handcrafted items, home furnishings, leather goods, fashion accessories, and more.
From Today, Essentials Get Cheaper:
| Category | Previous GST Rates | New GST 2.0 Rates | Impact on Consumers and Exporters | Panoramic Sourcing Advantage |
|---|---|---|---|---|
| Essentials & Daily Items | 12% / 18% | 5% | Significant price reduction; more affordable sourcing for global buyers | Easier bulk sourcing of groceries, personal care, packaged foods |
| Household Appliances & Electronics | 28% | 18% | Cheaper electronic goods, appliances, and faster export cost efficiencies | Wide range of competitively priced home furnishings and electronics sourcing |
| Automobiles & Auto Parts | 28% | 18% | Price drop for vehicles and parts, boosting retail and export segments | Reliable sourcing partner for automotive component exports |
| Handcrafted & Artisan Goods | 12% / 18% | 5% | Enhanced global competitiveness; supports artisan livelihoods | Direct access to authentic Indian handicrafts and fashion accessories |
| Leather Goods | 18% | 18% (standardized, easier refunds) | Simplified export process and transparent pricing | Premium leather sourcing with compliance assurance |
| Luxury & Sin Goods | 28% / varied | 40% | Increased tax on luxury items; not impacting essentials | N/A |
| Tax Structure Feature | Description |
|---|---|
| Two Main GST Slabs | 5% for essential goods, 18% for standard goods |
| High GST Slab | 40% for ultra-luxury and sin goods |
| Simplified Compliance | Reduced GST slabs improve transparency and ease of invoicing |
| Export Refunds | Faster and easier refund mechanisms for exporters |
Conclusion
GST 2.0’s rollout ushers in a new era of affordability and simplicity, transforming India’s export potential across essential goods, artisanal crafts, and more. By aligning with Panoramic Sourcing, global buyers gain streamlined access to India’s most competitive sourcing options under this groundbreaking tax reform.
FAQ: GST 2.0 Rollout – What You Need to Know
Q1: What is GST 2.0 and when did it take effect?
GST 2.0 is the latest reform of India’s Goods and Services Tax system that simplified tax rates into mainly two slabs: 5% and 18%, with a higher slab of 40% for luxury/sin goods. It took effect from September 22, 2025.
Q2: Which goods became cheaper with GST 2.0?
Daily essentials like groceries, packaged foods, medicines, personal care items, electronics, home furnishings, and handicrafts saw sharp GST cuts—mostly down to 5% or 18%—making them more affordable for buyers and exporters globally.
Q3: How does the two-slab tax structure simplify things?
The simplified 5% and 18% slabs replace the earlier multiple rates, making compliance easier, reducing invoice complexities, and improving transparency for businesses and consumers alike.
Q4: What impact does GST 2.0 have on exporters?
Exporters benefit from simplified GST rates, faster tax refunds, and reduced embedded costs, which help lower export prices and enhance India’s global sourcing competitiveness.
Q5: Are luxury and sin goods taxed differently in GST 2.0?
Yes, a higher 40% GST rate is levied on ultra-luxury and sin items such as tobacco, high-end cars, casinos, and aerated drinks with added sugar.
Q6: Will buyers actually see price reductions?
While the government mandates companies to pass GST savings to consumers, actual price reductions depend on market dynamics and retailer compliance. Some sectors like automobiles and FMCG have already announced price cuts.
Q7: How does GST 2.0 affect handcrafted items and leather goods?
Handcrafted items and leather goods mainly enjoy lower GST rates and faster refunds, improving margins for artisans and exporters, thus boosting India’s handmade export potential.