The CBIC has issued Notification No. 15/2025-Central Tax (Rate) and Notification No. 16/2025-Central Tax (Rate) dated 17.09.2025, to give effect to the recommendation relating changes in GST tax rates on various services and providing new exemption for services, providing relief to individuals, common man, aspirational middle class as discussed by the GST Council in its 56^th GST Council meeting held on 03^rd September, 2025. These changes are effective from 22.09.2025. 

These are discussed as under:

A. Exemption on services – vide NN. 16/2025 – Central Tax (Rate)

Key Amendments are as under:

I. Local Delivery Services Exception (Serial No. 18) – An explanation has been inserted clarifying that nothing in the entry applies to:

1. Local delivery services provided by an electronic commerce operator, or

2. Local delivery services provided through an electronic commerce operator.

II. New Entries Introduced (Serial No. 36C , 36D and 36E)

• All individual health insurance, along with reinsurance thereof.
• All individual life insurance, along with reinsurance thereof.

III. Definitions Added/Amended

a. Clause (ze): ‘Goods Transport Agency’ – Excludes electronic commerce operators providing or facilitating local delivery.

b. Clause (zfb): ‘Group’ – Defines a group as persons joining for a common purpose other than availing insurance, including Employer–employee groups and Non-employer–employee groups (with a clear relationship with master/group policyholder).

c. Clause (zga): ‘Health Insurance Business’ Includes contracts covering sickness, medical, surgical, hospital expenses, travel cover, and personal accident cover.

Similar Notifications have been issued under Union Territory Tax (Rate) and Integrated Tax (Rate) vide Notification No. 16/2025- Union Territory Tax (Rate) and Notification No. 16/2025- Integrated Tax (Rate) respectively.

The Complete Central Tax Notification can be accessed at https://taxo.online/wp-content/uploads/2025/09/16-2025-CTR-eng.pdf

The Complete Integrated Tax Notification can be accessed at https://taxo.online/wp-content/uploads/2025/09/16-2025-ITR-Eng.pdf

B. Change in GST rates on services – vide NN. 15/2025 – Central Tax (Rate)

S. No.	Changed from	Particulars
1.	Rate reduction from 12% to 5%	Job-Work Sector in relation to manufacture of umbrella, printing of all goods falling under Chapter 48 or 49, bricks, goods falling under Chapter 30 (pharmaceutical products), hides, skins and leather falling under Chapter 41. Third-party insurance of goods carriage Admission to exhibition of cinematograph films, price of admission ticket is one hundred rupees or less. Hotel accommodation (value less than or equal to  7,500 per day) Services by way of treatment of effluents by a Common Effluent Treatment Plant
2.	Rate reduction from 18% to 5%	Beauty and physical well-being services
3.	Rate increase from 12% to 18%	Construction Sector – Works contract involving predominantly earth work (>75% of value) provided to Government. Offshore works contract relating to oil and gas exploration. Sub-contractor services for such works. Other professional, technical and business services and Support services to exploration, mining or drilling of petroleum crude or natural gas or both. Supply of job-work not elsewhere covered (residual entry) Air transport of passengers in other than economy class Transport of goods in containers by rail (non-Indian Railways) Transport of goods by GTA Transportation of petroleum products through pipeline Textiles and Clothing accessories of sale value exceeding Rs. 2,500 per piece Renting of Motor Vehicle to carry passenger Renting of goods carriage with operator Multi-model transport of goods within India
4.	Rate increase from 28% to 40%	Specified Actionable Claims (betting, casinos, gambling, horse racing, lottery, online money gaming) Admission to casinos, race clubs, any place having casinos or race clubs, or sporting events like the IPL. Leasing or rental services, without operator, of goods.

b. Also, has various terms has been defined such as ‘recognised sporting event’, ‘handicraft goods’ , ‘mode of transport’, ‘multimodal transporter’, 

c. Amendment in Clause (xxxvi) – Effective from 1st April 2025 – Clause (xxxvi) of paragraph 4 deals with GST provisions related to hotel accommodation services and registration requirements.

Inserted Explanations:

Explanation 1: Defines the term “premises”. A premises refers to any place from where hotel accommodation services are being provided or are intended to be provided.

Explanation 2: Expands the meaning of “a person applying for registration” under sub-clause (c). Meaning: Includes a person applying for amendment of registration to declare an additional place of business.

Similar Notifications have been issued under Union Territory Tax (Rate) and Integrated Tax (Rate) vide Notification No. 15/2025- Union Territory Tax (Rate) and Notification No. 15/2025- Integrated Tax (Rate) respectively.

The Complete Central Tax Notification can be accessed at https://taxo.online/wp-content/uploads/2025/09/15-2025-CTR-eng.pdf

The Complete Integrated Tax Notification can be accessed at https://taxo.online/wp-content/uploads/2025/09/15-2025-ITR-Eng.pdf