Mumbai, Sep 4 (PTI) Benchmark equity indices Sensex and Nifty surged in early trade on Thursday as investors became cheerful after the GST Council approved a complete overhaul of the tangled Goods and Services Tax regime.

The 30-share BSE Sensex jumped 888.96 points to 81,456.67 in opening trade. The 50-share NSE Nifty surged 265.7 points to 24,980.75.

Common use items from roti/paratha to hair oil, ice creams and TVs will cost less, while tax incidence on personal health and life insurance will be brought down to nil after the all-powerful GST Council on Wednesday approved a complete overhaul of the tangled Goods and Services Tax (GST) regime.

The GST Council approved limiting slabs to 5 per cent and 18 per cent, effective from September 22, the first day of Navaratri.

From the Sensex firms, Mahindra & Mahindra jumped the most by over 7.50 per cent. Bajaj Finance, Hindustan Unilever, Bajaj Finserv, ITC, Tata Motors and UltraTech Cement were also among the gainers.

However, Eternal, Tata Steel, NTPC and HCL Tech were among the laggards.

"The revolutionary GST reform has come better-than-expected benefitting a wide spectrum of sectors. The ultimate beneficiary is the Indian consumer who will benefit from lower prices. The potential big boost to consumption in an economy that is already in growth momentum will be big and may surprise on the upside," VK Vijayakumar, Chief Investment Strategist, Geojit Investments Limited, said.

He further added that after the initial enthusiasm, tariff issues will continue to haunt the market.

In Asian markets, South Korea's Kospi and Japan's Nikkei 225 index traded in positive territory while Shanghai's SSE Composite index and Hong Kong's Hang Seng quoted lower.

US markets ended mostly higher on Wednesday.

Foreign Institutional Investors (FIIs) offloaded equities worth Rs 1,666.46 crore on Wednesday, while Domestic Institutional Investors (DIIs) bought stocks worth Rs 2,495.33 crore, according to exchange data.

Global oil benchmark Brent crude dipped 0.56 per cent to USD 67.22 a barrel.

On Wednesday, the Sensex jumped 409.83 points or 0.51 per cent to settle at 80,567.71, and the Nifty climbed 135.45 points or 0.55 per cent to 24,715.05. PTI SUM SUM DR DR

GST slab rationalization eases tax burdens, cutting rates on consumer goods and insurance and prompting market rally. The GST Council approved rationalizing the tax framework by consolidating slabs to 5 per cent and 18 per cent, reallocating goods and services to lower tax burdens on common consumer items and reducing or eliminating tax on personal health and life insurance, thereby simplifying rates and altering tax incidence with likely consumption and market effects.