The fiscal impact of the proposed Goods and Services Tax (GST) rate rationalisation remains acceptable and will result in an estimated GST revenue loss of 1.1 trillion per year or 0.3 percent of GDP according to according to a UBS report revealed.

In the year 2026's financial year the company anticipated a deficit of Rs 430 billion which is 0.12 percent of GDP that could be covered by surplus cess collection and an increase in dividends than budgeted by the Reserve Bank of India.

The UBS GST report, which was reported by ANI pointed out the fact that the GST overhaul India would be more effective in promoting consumption than personal tax cuts or tax cuts for corporations, since it directly affects the spending on the spot of purchasing.

In a report of the National Institute of Public Finance and Policy which stated the fact that "the GST multiplier stands at -1.08, higher than the multipliers for personal income tax (-1.01) and corporate tax (-1.02)."

The Independence Day speech from the Red Fort, Prime Minister Narendra Modi announced his intention to announce that "upcoming next-gen India tax reform 2025 before Diwali" will be beneficial to small businesses, consumers and MSMEs.

In the following days the finance ministry announced its proposal to simplify the GST structure, based around three pillars: restructuring the tax system, fiscal cost of GST changes and a more comfortable way of life.

Sources have now discovered that the Centre proposes to eliminate the current 28% and 12 percent slabs, while keeping the 5 percent and GST rates of 18. Government sources have said the majority of items in the the 12% slab is proposed to be moved into 5% slabs and the majority of things within the 28% slab have been planned to be moved in the 18 percent slab.

The GST Council meeting is expected between September and October, to review the plan, ANI reported.