<h1>Finance Ministry Proposes Simplified Two-Tier GST Rates with Special Slabs and Tech-Driven Compliance Reforms</h1> The finance ministry has proposed a two-tier GST rate structure comprising 'standard' and 'merit' slabs, along with special rates for select items, aiming to simplify the current four-tier system and reduce the tax burden on daily use goods. This proposal, submitted to a Group of Ministers (GoM) panel, also addresses the impending end of the compensation cess regime in March 2026 by suggesting mechanisms for taxing goods currently subject to the cess. The reforms focus on structural changes, rate rationalisation, and ease of compliance, including technology-driven GST registration and automated refund processing. The GST Council is expected to discuss these proposals in a forthcoming meeting, with the goal of implementing the reforms within the current financial year to enhance economic activity, reduce classification disputes, and improve ease of doing business. The government emphasizes cooperative federalism and consensus-building with states to ensure a simple, stable, and transparent GST framework.