New Delhi, Aug. 18 -- The government's recent decision to rationalise Goods and Services Tax (GST) rates is likely to ramp up domestic demand and lift consumer sentiment, according to a report by Centrum Institutional Research.

The report highlighted that the reforms will focus on rationalising GST rates for essentials and daily-use items.

This, it said, would have multiple benefits including improving consumer confidence, spurring demand through volume pick-up, narrowing the pricing gap between large organised players and smaller unorganised players.

It will also improve market penetration through low-priced SKUs that increase accessibility in rural markets, and encouraging premiumisation in the sector.

It stated, "We believe, the mo...