Indian state and federal ministers will meet for two days from Wednesday to weigh the biggest cuts to consumption tax in eight years, aimed at spurring domestic demand in the face of economic headwinds from US/ tariffs. A panel on the tax, headed by Finance Minister Nirmala Sitharaman with ministers from all Indian states, will decide on a plan to cut the tax on more than 400 items, ranging from hair oil to small cars. It will also consider a higher tax of 40 percent on some luxury and "sin" goods such as cigarettes. Economists expect the cuts to cost $21 billion in revenue losses, with states set to lose more than the federal government. Taxes on air travel in the premium and business classes could also go to 18 percent from 12 percent.

Source: bd News24 September 03, 2025 04:44 UTC