ICC hosts dialogue on GST 2.0, reaffirming India’s commitment to a simplified and resilient tax ecosystem
Kolkata, 7th November, 2025: The Indian Chamber of Commerce (ICC) organised a special session on “GST 2.0: Impact & Way Forward”, focusing on the changes and future direction of India’s indirect tax system. The discussion explored how the next phase of the Goods and Services Tax (GST) aims to make the system more transparent, efficient, and business-friendly. The session was attended by Mr. Shrawan Kumar, Principal Chief Commissioner, CGST & Central Excise; Mr. Vikram Prakash Wani, Commissioner, Kolkata North; Mr. Pravin Kumar Agrawal, Commissioner, Audit–I Kolkata; Mr. Brij Bhushan Agarwal, President, ICC and CMD, Shyam Metalics & Energy Ltd; and Dr. Rajeev Singh, Director General, ICC. Experts shared their views on the evolution of GST since its launch, key policy updates, and the government’s vision for a simpler and more progressive tax structure.
Reflecting on the evolution of India’s indirect tax system, Mr. Shrawan Kumar, Principal Chief Commissioner, CGST & Central Excise, said that since its introduction in 2017, the Goods and Services Tax (GST) has been a watershed reform in India’s indirect tax framework. It was aimed at eliminating the cascading effect of multiple taxes, creating a uniform national market, simplifying administrative processes, and efficiently handling billions of invoices and returns across taxpayers. From 2017 to the present, there have been 56 GST Council meetings—averaging around seven per year, or two per quarter—each contributing incremental refinements to strengthen the system.
Highlighting the changes introduced in the 2024 Union Budget, Mr. Kumar noted that four key amendments were implemented to enhance compliance and fairness in the GST framework. The first amendment relaxed the restriction under Section 16(5), which required availing input tax credit (ITC) on invoices by 30th November of the following financial year. This relaxation was applied retrospectively for the initial four years of GST to address delays arising from late receipt or system-related issues.
The second amendment introduced an amnesty measure, allowing the waiver of interest and penalties for showcause notices issued between 2017 and 2020 under Section 73, provided no suppression was involved. The third major change came through the introduction of Section 11A, which empowered the government to grant retrospective exemptions in cases where an established industry practice on tax rates was later found to differ from the legally intended rate. The fourth and final amendment brought in Section 74A, standardising the time limit for issuance of demand or show cause notices to 3.5 years in both suppression and non-suppression cases, thereby replacing the earlier practice of invoking extended five-year periods without sufficient cause.
Speaking about the next phase of evolution, Mr. Kumar elaborated that the GST 2.0 reforms, announced after 3rd September 2024, have introduced significant changes across three major areas—rate restructuring, process reforms, and widespread rate reductions. Under rate restructuring, GST slabs have been simplified primarily to 5% and 18%, with the 12% and 28% categories largely eliminated to reduce classification disputes and ease compliance.
In terms of process reforms, the changes are designed to make compliance faster and more transparent. Registrations are now granted within three days for taxpayers with monthly tax liabilities up to ₹2.5 lakh, a category that represents nearly 90% of all taxpayers. Exporters with clean compliance records can now receive 90% of their refund within one week, with the remaining amount disbursed within 60 days. Additional measures have been introduced to provide greater clarity on post-sale discounts and to operationalise the long-awaited GST Appellate Tribunal, which will commence functioning in Kolkata and other locations from 1st December 2025.
Mr. Kumar further explained that the third key area of GST 2.0 reform focuses on widespread rate reductions benefiting consumers and critical sectors. In healthcare, pharmaceuticals, medical devices, hospital rooms, CT scans, gyms, salons, and fitness centres are now taxed at just 5%. The insurance sector has also been fully exempted from GST. These reforms have extended tangible benefits to sectors such as agriculture, construction, and food, while also providing significant relief to industries crucial to West Bengal’s economy, including jute, leather, handicrafts, and footwear. Cement, a key input material, has seen its tax rate reduced from 28% to 18%. Only a limited set of “sin goods” and luxury items such as tobacco, alcohol, gaming, and casinos remain in the 40% bracket.
Collectively, these adjustments are designed to address inverted duty structures, boost consumption, improve cash flows, enhance the ease of doing business, formalise the economy, and strengthen India’s global competitiveness. The impact of these reforms is evident in macroeconomic indicators. Monthly GST revenue collections have increased from approximately ₹80,000 crore in 2017 to around ₹2 lakh crore at present. The Reserve Bank of India (RBI) and the International Monetary Fund (IMF) have both revised India’s projected GDP growth rate upward—from 6.5% to 6.8%—underscoring the positive macroeconomic impact of GST reforms.
GST continues to demonstrate steady and sustainable performance. Revenue growth recorded a 9% increase in September and 4.6% in October compared to the previous year, reflecting the continued momentum of the reform, while West Bengal has shown an impressive 14% growth, underscoring the state’s strong compliance and economic resilience.
Mr. Kumar also mentioned that the revised GST rates are expected to be reflected on product price tags within the next 20 to 30 days — a matter that currently concerns many consumers.
Mr. Brij Bhushan Agarwal, President, Indian Chamber of Commerce and CMD of Shyam Metalics & Energy Ltd, offering an industrial perspective, said, “The introduction of the Goods and Services Tax marked a major milestone in India’s economic reform by unifying a fragmented indirect tax system, simplifying compliance, and establishing a common national market. Since its rollout, GST has continued to evolve, contributing significantly to improvements in the ease of doing business.”
He added, “GST 2.0 represents another substantial phase of reform, aimed at simplifying administration, improving revenue efficiency, and strengthening governance through technology. The shift to a simplified two-rate structure of 5% and 18%, along with the correction of inverted duty structures, is expected to stimulate demand, increase consumption, and support industrial and economic growth.”
Highlighting operational aspects, Mr. Agarwal said, “GST 2.0 also includes improvements such as pre-filled returns, faster refund processing for exporters, and a more streamlined registration process, which are particularly beneficial for MSMEs and export-oriented sectors. The introduction of the GST Appellate Tribunal provides a structured and timely mechanism for dispute resolution, enhancing transparency and business confidence.”
He further noted, “Recent data indicates that GST collections for October 2025 reached ₹1.95 lakh crore demonstrating strong market activity. These reforms are expected to reduce costs, improve compliance, support supply chain efficiency, and positively influence sectors such as FMCG, cement, and consumer durables, while reinforcing GST’s role as a dynamic framework that continues to adapt to economic needs.”
