Modi proposes GST overhaul to boost domestic consumption
Prime Minister Modi just announced a proposal to update India's GST system: fewer tax rates (with a plan for 5% for essentials and 18% for most things), plus a new 40% rate for "sin" goods.
The plan also aims to make filing taxes easier—think pre-filled returns—and is set to help small businesses breathe easier, pending final approval and implementation.
Why now? Why this?
With the US slapping steep tariffs on Indian exports, India needs stronger local spending.
These GST changes are designed to cut red tape, lower tax burdens, and give a push to domestic consumption—which is already about 60% of the country's economy.
Economists say this could mean faster growth (up to 6.5% GDP), more jobs, and a friendlier business climate for anyone dreaming of launching or growing something in India right now.