Varanasi, Sep 4 : A wave of happiness has swept through Prime Minister Narendra Modi's parliamentary constituency, Varanasi following a significant reduction in GST rates. Both traders and common citizens on Thursday expressed relief and gratitude, calling it a welcome move that eases financial pressure and boosts business.

Local traders believe the GST cut will benefit not only consumers but also revive local markets. Many have praised the government for taking a step that counters global tariff pressures, particularly those imposed by the United States.

IANS spoke to a Chartered Accountant (CA), trader and a local citizen to get their views on the order.

Kaushal Pandey, a chartered accountant, said, 'This is a big change. The government has introduced two slabs, making goods more affordable for all. It was expected that the government would respond to US tariffs, and they have. People can now buy essentials at reasonable prices.'

Trader Sunil Upadhyay echoed this sentiment, noting, 'This will definitely help the lower and middle classes. The GST on packed items has been reduced to 5 per cent, which is really good.'

Tulsi Kamalkant Joshi, a local resident, added, 'The prices have been almost halved. This is a huge relief for ordinary people. The lower and middle-income groups will clearly benefit.'

Meanwhile, as the GST Council approved historical changes to India's indirect tax structure, several daily-use goods will become cheaper from September 22.

The new tax structure, adopted on Wednesday, has two major slabs now 5 per cent and 18 per cent, and a whopping 40 per cent for sin goods.

For the common man, this change means more money in hand, which the government hopes will be routed into the economy, giving it a significant boost.

From groceries and fertilisers to footwear, textiles, and even renewable energy, a broad basket of goods and services is set to become more affordable. Items previously taxed at 12 per cent and 28 per cent will now largely migrate to the other two slabs, making a wide range of products cheaper.

Food and daily essentials:

Milk products: Ultra-high temperature (UHT) milk will now be tax-free (down from 5 per cent), while condensed milk, butter, ghee, cottage cheese, and cheese have moved from 12 per cent to 5 per cent or nil in some cases.

Staple foods: Malt, starches, pasta, cornflakes, biscuits, and even chocolates and cocoa products will see rates reduced from 12'18 per cent to 5 per cent.

Dry fruits and nuts: Almonds, pistachios, hazelnuts, cashews, and dates, earlier taxed at 12 per cent, will now attract just 5 per cent tax.

Sugar and confectionery: Refined sugar, sugar syrups, and confectionery items like toffees and candy have shifted to the 5 per cent slab.

Other packaged foods: Vegetable oils, animal fats, edible spreads, sausages, meat preparations, fish products, and malt extract-based packaged foods have been moved to the 5 per cent slab.

Namkeens: Bhujia, mixtures, chabena and similar edible preparations ready for consumption form (other than roasted gram), pre-packaged and labeled to go from 18 per cent to 5 per cent.

Water: Natural or artificial mineral waters and aerated waters, not containing added sugar or other sweetening matter, nor flavoured to move from 18 per cent to 5 per cent.

Agriculture: Fertilisers are down from 12 per cent/18 per cent to 5 per cent.

Select agricultural inputs, including seeds and crop nutrients, have been rationalised from 12 per cent to 5 per cent.

Healthcare: Life-saving drugs, health-related products, and some medical devices have seen rate cuts from 12 per cent/18 per cent to 5 per cent or nil.

Individual life and health insurance policies, including family floater, which had a 12 per cent tax, will no longer be taxed.

A massive chunk of medical items of regular use -- including thermometers and glucometers -- will be in the 5 per cent tax bracket.

Consumer goods: Entry-level and mass-use items like select electrical appliances will move from 28 per cent to 18 per cent.

Footwear and textiles have seen GST cut from 12 per cent to 5 per cent, reducing costs for mass-market products.

However, certain goods and services remain firmly under higher taxation.

Pan masala, gutkha, cigarettes, chewing tobacco, zarda, unmanufactured tobacco, and bidi will continue under existing high GST rates and compensation cess until outstanding cess-linked loans are cleared.

Additionally, the valuation of these products will now be shifted to Retail Sale Price (RSP) instead of transaction value, tightening compliance.

All goods (including aerated waters), containing added sugar or other sweetening matter or flavoured to go from 28 per cent to 40 per cent.

A new 40 per cent slab for sin and luxury goods remains, ensuring that items like cigarettes, premium liquor, and high-end cars don't see tax relief.

Imported armored luxury sedans will be exempt only in special cases, such as those brought in by the President's Secretariat.

/IANS