GST Reforms: A Game-Changer for India's Economy, Says Union Finance Minister

Union Finance Minister Nirmala Sitharaman highlighted GST reforms' transformative impact, infusing ₹2 trillion into the economy and reducing tax burdens on citizens. Key changes include shifting 99% of items from the 12% slab to 5%, benefiting the middle class. GST revenues rose to ₹22.08 trillion, with taxpayers increasing from 6.5 million to 15.1 million. Sitharaman emphasized these reforms significantly boost affordability, economic inclusivity, and India’s growth trajectory.

Union Finance Minister Nirmala Sitharaman recently highlighted the transformative impact of Goods and Services Tax (GST) reforms on the Indian economy, emphasizing the infusion of ₹2 trillion into the system. Speaking at the Outreach and Interaction Program on Next Gen GST Reforms in Visakhapatnam, she underscored the reforms' role in leaving more disposable income with citizens and driving economic growth.

The Finance Minister remarked that reducing GST rates has saved Indians approximately ₹2 trillion, calling these changes a "major boost" for the economy. She described GST reforms as a pivotal step in streamlining taxation and fostering financial inclusivity.

GST Reforms: A Boon for the Middle Class

Sitharaman emphasized that the restructuring of GST rates has had a particularly positive impact on the middle class. She revealed that 99% of the items previously taxed under the 12% GST slab are now under the 5% bracket, significantly reducing the tax burden on everyday goods. Additionally, 90% of the items in the 28% slab have been shifted to the 18% category, making goods more affordable for consumers.

“These changes are not merely about taxation but are aimed at reducing poverty and improving the standard of living for the common man,” she explained.

The minister further pointed out that the benefits of these reforms far outweigh the incentives offered to various industries, estimating their value to be tenfold.

GST's Contribution to Revenue Growth

Highlighting the revenue impact, Sitharaman noted that GST collections have surged to ₹22.08 trillion in 2025, a substantial increase since the tax regime's inception. The number of taxpayers has also seen remarkable growth, rising from 6.5 million to 15.1 million, reflecting an expanding tax base and improved compliance.

Upcoming Engagements in Visakhapatnam

In addition to discussing GST reforms, Sitharaman is scheduled to attend the Confederation of Indian Industry (CII) business summit on Global Capability Centres (GCCs) later in the day. The summit will delve into emerging trends in business operations, the factors influencing decision-making for city and state selection, and the role of state policies in attracting GCCs.

The Finance Minister will also participate in Prime Minister Narendra Modi’s virtual address on the ‘Swasth Nari, Sashakt Parivar Abhiyaan’ initiative before attending the GCC-focused discussions.

A Step Towards Economic Empowerment

The GST reforms have undoubtedly emerged as a cornerstone of India’s economic progress, simplifying taxation, boosting revenues, and lightening the financial load on citizens. Sitharaman’s address made it clear that these measures are not only about economic efficiency but also about empowering the middle class and fostering a more inclusive growth trajectory.

As India continues to refine its fiscal policies, the positive momentum generated by GST reforms is expected to propel the nation toward greater economic resilience and prosperity.