The Ministry of Finance has released a fresh set of FAQs clarifying the implementation of GST 2.0, which takes effect from September 22, 2025. The new rules bring significant changes across healthcare, insurance, hospitality, beauty services, and even food delivery platforms.
Key Relief for Pharma and Medical Device Firms
Drug and medical device makers must revise the maximum retail price (MRP) and issue updated price lists to dealers and retailers to reflect GST rate cuts. However, the government clarified that re-labelling, re-stickering, or recalling existing stock already in the market before September 22 is not mandatory. This ensures minimal disruption for manufacturers and retailers while still passing on benefits to consumers.
Insurance Sector: New GST Rules
Exempted: Individual health and life insurance policies (including family floater plans).
Not Exempted: Group insurance policies.
Reinsurance services: Will now be fully exempt from GST.
The government also announced that insurance companies can no longer claim input tax credit (ITC) on commissions, brokerages, and other input services related to individual policies. This change means higher compliance costs for insurers, but the government’s intent is to pass on GST exemptions directly to policyholders.
Hospitality and Beauty Services
Hotels: Rooms priced ₹7,500 or less per night will attract 5% GST without ITC. Hotels will not be allowed to opt for 18% GST with ITC for such units.
Beauty and wellness services: Fixed at 5% GST without ITC, removing the option to charge 18% with ITC.
Experts say this move is aimed at ensuring end consumers get the maximum benefit from the tax cuts without businesses inflating costs through dual-rate options.
Food Delivery & Quick Commerce Platforms
From September 22, local delivery services will attract 18% GST:
If the delivery partner is registered, they must pay GST directly.
If the partner is not registered, the liability shifts to the e-commerce operator (ECO).
This impacts popular platforms like Zomato, Swiggy, Blinkit, and Zepto, which have previously argued that delivery fees belong to workers and should not fall under their GST liability.
Why These Clarifications Matter
Tax experts believe these FAQs will help businesses adjust smoothly without unnecessary legal disputes. Rahul Shekhar, Partner – Indirect Tax at Nangia Andersen LLP, noted that the clarifications address common concerns on MRPs, ITC, and exemptions, ensuring a clear transition under GST 2.0.