GST 2.0 Rate Changes: Old vs New Rates on 170+ Items (2026)

What got costlier — and the two hikes that did not actually happen yet

The clearest increases hit the 40% de-merit rate. Large and luxury vehicles, and a short list of sin goods, now attract 40%. For most buyers this is irrelevant; for a luxury car buyer it is a headline number.

Here is the detail almost every "GST 2.0 explained" article gets wrong. Tobacco products — cigarettes, pan masala, gutkha, chewing tobacco — were notified for the 40% rate, but the hike was deferred. Those products continue to attract their old rate (28% plus compensation cess) until the government's compensation-cess loan and interest obligations are fully discharged, under a separate notification. So if you look up cigarettes today, the effective rate is still the old one, not 40%. Bidis were excluded from the 40% bracket entirely. This is exactly the kind of "notified but not in force" nuance our rate finder flags per-item, rather than showing you a rate that is not actually being charged.

Insurance: the exemption everyone celebrated, and the exception nobody mentions

Individual health and life insurance premiums are now GST-exempt (previously 18%), including the reinsurance on those policies. That is a genuine saving on your personal mediclaim or term cover.

But there is a carve-out that changes the math for employers: group and corporate insurance stayed at 18%. Only individual and family-floater policies were exempted. If your company provides group health cover, the GST on that premium did not disappear. This individual-versus-group distinction is the single most common mistake we see in GST 2.0 summaries — they report "insurance is now exempt" as a blanket statement, which is wrong for anyone buying cover through an employer or a group scheme.

How to check any specific item

Rate tables in articles go stale, and they never cover the item you actually care about. Two faster options:

Use the GST 2.0 Rate Finder to search 170+ items by name or HSN code and see the old rate, new rate, and whether a change is in force or deferred. Then, once you know the rate, use the GST Calculator to work out the CGST/SGST/IGST split on an actual invoice amount. If you are raising invoices, the GST Invoice Generator applies the right split automatically based on the buyer's state.

For the reasoning behind India's move to fewer slabs and how it fits the broader tax picture, see our guide on the Income Tax Act 2025 changes.

The bottom line

GST 2.0 is a simplification, not a giveaway. Most items dropped a slab, a few luxury and sin goods climbed to 40%, individual insurance went exempt while group insurance did not, and the tobacco hike is on the books but not yet charged. The safest move before you buy, sell, or reprice anything is to confirm the current rate for the exact item — because "the new GST rate" depends entirely on which item you mean and whether its change is actually in force.

Check your item in the free GST 2.0 Rate Finder right now — search the product you care about and see its old rate, new rate, and effective status in one line.