New Delhi, Sep 22 : Traders and business owners on Monday welcomed the next generation GST reforms, saying the changes will increase purchasing power, lower prices of essential items and give a big push to the economy.

They also praised Prime Minister Narendra Modi for introducing the measures during the festive season.

S.K. Sarda, a branded clothing store owner, said that the new GST framework has simplified the system and corrected earlier problems of multiple taxes.

He pointed out that the government has already collected nearly Rs 55 lakh crore through GST, which is being used for national development and defence purposes.

"The new reforms will put more money in people's hands. About Rs 2.5 lakh crore will flow into the market, and this amount will multiply three times as it rotates through the economy. This will create a turnover of nearly Rs 7 lakh crore, giving a major boost to employment and income across different sectors," he added.

Ramesh Periwal, who runs a diagnostics business in Sikkim and is also president of the local Chemists Association, said the reforms will be especially beneficial for the health sector.

"Medicines have become much cheaper. Some drugs are now under zero tax, while others that were earlier taxed at 12 or 18 per cent have been brought down to 5 per cent," he said.

"Hospitals will also save on essential reagents and chemicals that are now taxed lower, and the benefit will go directly to patients," he added.

Periwal highlighted that the reforms will also give a strong push to tourism in Sikkim, as hotel stays below Rs 7,500 will now attract lower GST.

"Tourism is the backbone of Sikkim's economy, and these changes will bring more visitors and boost the industry," he said.

Small business owner Vinay Chandra said the decision to bring milk and other daily-use food items under the zero per cent GST category is a major relief.

"Earlier, many essentials had 5 per cent GST, but now shifting them to zero will directly benefit poor families. It will also reduce kitchen expenses and support household budgets," he said.

Union Finance Minister Nirmala Sitharaman also visited Laxmi Nagar in the national capital after the implementation of the new GST reforms, where she interacted with shopkeepers and customers.

Speaking to the media during her visit, the Finance Minister said: "The response to the GST reforms has been very positive. Although it is a market holiday today, many shops are open. I observed that shopkeepers are passing on the benefits of GST reductions to their customers."

She added that the Narendra Modi government's decision has brought relief to both the public and traders, and people are happy with the reforms.

/IANS