Let’s celebrate the savings festival 

September 24, 2025

Abhishek Vij

The savings festival has begun on Monday, September 22nd, with the removal of the 12% and 28% tax slabs, after initially retaining two tax slabs: 5% and 18%. The prices of over 375 items in the GST tax structure have been reduced, meaning 99% of goods are now under the 5% GST slab. Now, with two tax slabs —5% and 18% —the tax burden has undoubtedly decreased.

The burden on people’s pockets has been lightened. With 99% of goods now under the 5% tax slab, we can expect an era of affordable prices to begin in the country.

Ordinary citizens can breathe a sigh of relief while shopping in the market. Now, we have to consider how much of a relief this is. Everyday items like ghee, cheese, butter, milk, and ice cream have become cheaper. TVs, washing machines, and ACs will also become cheaper. Additionally, tax exemptions were provided for incomes up to Rs 12 lakh. Thus, it is being said that citizens have been given savings of Rs 2.5 lakh crore. Hence, the invitation to celebrate the GST savings festival.

The announcement made by the Prime Minister from the ramparts of the Red Fort on August 15th has come into effect, but let’s also examine its potential consequences in real life. After the reduction in GST slabs, 375 items have been categorized into 54 categories. A list of these will be made, and the reduced prices will be displayed.

The government has ordered that a slip with the old price and the new reduced price be affixed to every item sold. This precaution is necessary because shopkeepers who have goods in stock at the old MRP will still display the same price on their slips, but it is now mandatory to affix a sticker with the reduced price. The order states that shopkeepers cannot avoid paying the reduced price on the pretext of having old stock. After September 22nd, all goods for sale will be sold at the new reduced prices.

Vigilance officers will monitor whether these orders are being followed. If the new price labels are displayed, consumers will clearly see whether they are receiving the full benefit of the price reduction. The hope now is that consumption and demand for these goods, which have become cheaper due to the price reduction, will increase. This will reduce inflation. Encouraged by this, investors will increase production, providing employment to the unemployed.

But as soon as the new GST rates were implemented, the stock market’s initial reaction was a fall in the index. This is because demand will continue to increase later, but for now, the lower prices have increased losses. This fear is not permanent. The government says that the price changes will compensate producers for losses incurred on old stocks, but there is no doubt that the market prices have decreased during these festive seasons, and this has instilled a new enthusiasm among consumers.

However, people devastated by the floods want increased incomes and generous compensation. The working class is hoping for an increase in dearness allowance. If the central and state governments together show generosity to the common man, the results will be immediately evident, and the joy of the festivals will be doubled. Then the expected demand will also increase, and the meaning of this savings festival will also become clear.