Authors: Mrs. Jayashree Swain
Abstract: The implementation of GST 2.0 represents the second major phase of India’s Goods and Services Tax reform, which is aimed at simplifying compliance, increasing transparency, and improving tax collection. It introduces significant changes affecting the consumer goods sector, including FMCG, electronics, and daily-use items. Tax rates on essentials like soaps, toothpaste, biscuits, and medicines have been reduced, making them more affordable. Consumer durables, textiles, toys, and beverages also saw rate cuts, boosting demand and helping MSMEs. These changes may cause revenue loss and pricing adjustments but are expected to reduce inflation. In contrast, higher GST rates have been imposed on sin and luxury goods to discourage their use and increase revenue. In light of these developments, this article analyses the overall impact of GST 2.0 on the consumer goods sector, covering key categories such as daily-use items, FMCG products, electronics, and durables.
