GST Rate Cuts To Boost India Inc. Revenues By 6

New Delhi, Sep 9 (KNN) Indian companies are expected to record a 6–7 percent rise in revenues in FY 2025–26 following the recent reduction in goods and services tax (GST) rates, according to a report by Crisil Intelligence.

The move is also projected to stimulate consumption, which contributes about 15 percent of corporate revenues.

The research firm noted that while the GST cuts will aid revenue growth, the ‘anti-profiteering rule’ is expected to prevent companies from significantly widening their profit margins, ANI reported.

The central government’s decision to rationalise GST rates was described as timely, coming ahead of the festive and wedding season and amid global uncertainty linked to trade tensions.

Sectors such as fast-moving consumer goods, durables, automobiles and construction are expected to benefit directly from the tax cuts, with spillover effects anticipated for aviation and agricultural inputs.

The report highlighted that GST on economy-class airfares remains unchanged at 5 percent, while rates on premium economy, business and first-class travel have been raised from 12 percent to 18 percent.

Given that economy-class passengers account for 92 percent of domestic airline revenues, Crisil expects minimal impact on demand in the premium segment.

In the automobile sector, GST on two-wheelers below 350cc has been reduced from 28 percent to 18 percent, effective September 22, 2025.

As these vehicles account for 90 percent of India’s two-wheeler market, the change is expected to lift sales by 100–200 basis points, or 1–2 percent, improving affordability for mass-market buyers.

(KNN Bureau)