Relief from GST Meeting, but Understand the Real Message Behind It

New Delhi :  After a long time, the government has finally given some relief to the common people with the announcement of two new GST slabs. The 5% and 18% slabs look simple on paper, but the reality is different. While the 5% category brings only about 3% of total revenue to the government, the 18% slab accounts for nearly 97% of GST income.

The government claimed that the decision was taken unanimously in the 56th GST Council meeting, where finance ministers from all states participated, including opposition-ruled states. However, questions are being raised: if the announcement was finalized in the meeting, then how did Prime Minister Narendra Modi already declare it from the Red Fort on August 15? Did he already know that opposition-ruled states would fall in line, or does it reflect that ultimately, all decisions are dictated by the PM?

The 56th meeting of the GST Council, held at Delhi’s Vigyan Bhawan on 3–4 September, was expected to be contentious. Many believed it would be difficult to convince states like West Bengal, Kerala, Punjab, and Karnataka. But Finance Minister Nirmala Sitharaman managed to secure consensus on the very first day. By the night of 3rd September, she announced massive GST rate cuts—from luxury cars to air conditioners, and even shaving creams to ice cream—now forming part of what is being called “GST 2.0.”

According to sources, opposition-ruled states initially resisted, fearing revenue losses. Bengal, in particular, strongly objected. Sitharaman reassured them that both the Centre and states share GST revenue, so any loss would be mutual. Gradually, Punjab and Bengal relented, with Mamata Banerjee even taking credit, saying she had demanded such reforms years ago. Karnataka and Kerala, however, remained firm until the end, insisting on a compensation assurance. When talks reached a deadlock, Chhattisgarh’s finance minister O.P. Choudhary suggested putting it to a vote—something rare in GST Council history.

Finally, Bengal mediated and convinced Karnataka and Kerala, leading to consensus. Thus, the much-anticipated GST reforms were cleared in record time, sending both relief to consumers and a political message: that despite resistance, the Centre’s will ultimately prevails.