“We are now bringing in next-generation GST reforms. This will become a Diwali gift for the nation,” he added.

New GST Plan: Centre proposes to scrap current slab of 12% and 28% of GST, 'proposes...'

New GST Plan: The Central government has proposed two rates – 5% and 18% – under the updated Goods and Services Tax regime, news agency ANI reported, quoting government sources.

According to sources, approximately 90 percent of taxable items in the existing 28% range of income or tax rate are likely to shift to the 18% slab in the revamped regime.

Common man items and daily-use products are likely to be taxed at 5% while luxury goods products are likely to be taxed at 40% GST.

Prime Minister Narendra Modi, earlier today on Independence Day, addressing the nation, said the government is all set to bring major reforms in GST.

He said, "This Diwali, I am going to give you a 'double Diwali' gift. A major announcement is on the way for the people of the country. Over the past eight years, we implemented a major GST reform that significantly reduced the tax burden across the nation. Now, after eight years, the time has come to review it. We have formed a high-powered committee to begin this review process and have held consultations with the states as well.”

“We are now bringing in next-generation GST reforms. This will become a Diwali gift for the nation,” he added.

He said, tax rates on essential goods and daily needs will be reduced, and that it will bring significant relief and convenience. “Our MSMEs and small industries will also benefit greatly from these changes," he added.

At present, the government currently levies GST at  5%, 12%, 18% and 28% on most goods and services. These do not apply to gold and silver.

Additionally, there are extra taxes on intoxicant items such as cigarettes and high-end cars.

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