Dear Sir/Madam,

This has reference to the 56th GST Council Meeting held under the chairpersonship of Hon’ble Union Minister of Finance, Smt. Nirmala Sitharaman, on 3rd September 2025.

During the meeting, the Council approved the rationalization of the Goods and Services Tax (GST) structure into two slabs of 5% and 18%, thereby removing the existing 12% and 28% slabs.

Accordingly, GST rates of several textile items have been revised.

In line with industry representations, the Council has also addressed the long-pending issue of inverted duty structure in the MMF textile value chain and ensured fibre neutrality.

The revised GST rates (effective 22nd September 2025) are as follows:

Particular	Old GST Rate	New GST Rate
MMF Fibre	18%	5%
MMF Filament/Yarn	12%	5%
Carpets	12%	5%
Certain labels, badges, braids, ornamental trimmings, embroidery, wall coverings, textile hose piping, handmade/hand embroidered shawls and certain types of specialized fabrics	12%	5%
Apparels (HSN 61 and 62) Made-ups (HSN 63, except for 2nd hand clothing) Cotton quilts	5% (sales value ≤ ₹1000) 12% (sales value > ₹1000)	5% (sales value ≤ ₹2500) 18% (sales value > ₹2500)
Sewing machines, other than book-sewing machine of heading 8440 and sewing needles	12%	5%
Cartons boxes, cases, sacks/rags of paper	12%	5%

HSN code-wise details of the new rates pertaining to T&A products (HSN 50 to 63) are available in Annex 1 of the attached press statement (S. No. 200–245).

Further the council has also taken certain measures towards facilitation of trade, some of which are as under:

• The Council recommended amending section 54(6) of the CGST Act, 2017, to provide for sanction of 90% of refund claimed on provisional basis, in cases arising out of inverted duty structure, on similar lines as is presently available for refund in respect of zero-rated supply. It shall be operationalize by 1^st November 2025, after which such provisional refunds will be made within 7 days of filing (if applicable).

• The Goods and Services Tax Appellate Tribunal (GSTAT) will be made operational for accepting appeals before end of September and will commence hearing before end of December this year. The Council also recommended the date of 30.06.2026 for limitation of filing of backlog appeals.

• The Council recommended amendment to section 54(14) of the CGST Act, 2017 so as to remove the threshold limit for refunds arising out of exports made with payment of tax. This will particularly help small exporters making exports through courier, postal mode etc.

• The Council has recommended the introduction of an optional simplified GST registration scheme wherein registration shall be granted on an automated basis within three working days from the date of submission of application in case of low risk applicants and applicants who based on their own assessment, determine that their output tax liability on supplies to registered persons will not exceed Rs. 2.5 lakh per month (inclusive of CGST, SGST/UTGST and IGST).

Press statement detailing above and other such measures is attached for the kind perusal of members.

Members are requested to take note of the above developments and plan their production and compliance activities accordingly.

With Regards,

(Chandrima Chatterjee)

Secretary General