Mumbai (Maharashtra) [India], September 4 (ANI): Maharashtra Chief Minister Devendra Fadnavis on Thursday welcomed the GST reforms, calling them second-generation changes that will ease the tax burden on people and give a major boost to the country's economy.

Speaking to the reporters, Devendra Fadnavis said, 'Second generation reforms were much needed and the Prime Minister has initiated second generation reforms. This will reduce the burden of taxes on consumers and increase trade, demand, production and employment. This will give a huge boost to the country's economy... The Maharashtra government supports these reforms...'

Gujarat Finance Minister Kanubhai Desai also praised the reforms saying that the common people would benefit from this.

'The Prime Minister had said that people would receive gifts on Diwali... There has been a significant reduction in GST. On cement, food items, insurance, and insurance premiums, reductions have been made in GST on all these. Common people have received many such benefits,' he said.

A day earlier, Finance Minister Nirmala Sitharaman announced a sweeping reduction in GST, aimed at providing relief to households, farmers, businesses and the healthcare sector.

The 56th GST council meeting decided to rationalise GST rates to two slabs of 5 per cent and 18 per cent by merging the 12 per cent and 28 per cent rates.

5% slab consists of essential goods and services, including food and kitchen item like butter, ghee, cheese, dairy spreads, pre-packaged namkeens, bhujia, mixtures, and utensils; agricultural equipment like drip irrigation systems, sprinklers, bio-pesticides, micronutrients, soil preparation machines, harvesting tools, tractors, and tractor tires; handicrafts and small industries like sewing machines and their parts and health and wellness like medical equipment and diagnostic kits.

While the 18% slab consists of a standard rate for most goods and services, including automobiles such as small cars and motorcycles (up to 350cc), consumer goods like electronic items, household goods, and some professional services, a uniform 18% rate applies to all auto parts.

Additionally, there is also a 40% slab for luxury and sin goods, including tobacco and pan Masala, products like cigarettes, bidis, and aerated sugary beverages and on luxury vehicles, high-end motorcycles above 350cc, yachts, and helicopters.

Moreover, some essential services and educational items are fully exempted from GST, including individual health, family floater and life insurance, no GST on health and life insurance premiums and education and healthcare, like certain services related to education and healthcare are GST-exempt. (ANI)