“ GST 2.0: “Next-Generation Reform” is a catalyst for India’s Smart Metering & Semiconductor Ecosystem

 

The rollout of GST Reform 2.0, effective September 22, 2025, marks a pivotal step in India’s indirect tax evolution. The rationalization of GST slabs to 5% and 18%, alongside a 40% demerit rate for luxury and sin goods, underscores a bold, future-focused reform that simplifies compliance, enhances economic efficiency, and supports domestic innovation. (Reuters;  The Times of India; India Briefing.)

 

However, initial government communications emphasize that GST 2.0 is a Next-Generation Reform” focused on a simplified tax structure, rate rationalization through a two-slab system, and key process reforms like automated registration, pre-filled returns, and faster refunds. These measures aim to ease compliance, promote ease of business, and reduce the tax burden especially on daily-use items while fostering growth for MSMEs and ensuring a fairer, more efficient system Of particular significance is the GST reduction on semiconductor components, including silicon wafers, from 12% to 5%. This targeted measure reflects the Government’s intent to strengthen India’s electronics manufacturing base, lower input costs, and accelerate smart meter deployment under the RDSS initiative. Together, these changes bolster the ‘Make in India’ vision and encourage deeper investment in critical technologies. (Lapaas Voice).

 

Complementary tax adjustments on electronics, appliances, and clean mobility solutions are expected to stimulate demand, streamline project execution for DISCOMs, and create a more competitive landscape for Indian manufacturers. (Reuters; The Economic Times). At Allied Engineering Works Limited, we view GST 2.0 as more than a fiscal adjustment; it is a strategic enabler of technology-driven infrastructure, empowering India’s journey toward smarter energy systems, greater consumer access, and global leadership in advanced manufacturing.”