In a meeting with the CBIC chairman, FMCG, along with executives from consumer-facing industries, sought the government’s assistance in tracking the costs post the new goods and services tax (GST) rates that came into force, to ensure that consumers receive the benefits.
Many executives requested that CBIC issue directives to all FMCG firms to execute the rate revision with proper stickering and revised invoicing, while also tracking the costs of goods in the market for the subsequent six months.
Executives specified the hindrances that came with the GST rate reduction execution. Senior executives have cited that the meeting was conducted to comprehend any execution of issues that arose in the GST rate cuts.
Clarity has been asked by the executives about the input tax credit (ITC) adjustment and specifies the irregularities in HSN codes for specific products.
The GST rate cut to 5% from 12% and 18% earlier shall generate excess ITC credit for the distributors. The same is required to be specified.
They asked for clarification on the anomaly in GST rates for identical products under distinct HSN codes.
Under HSN Code 3401, the GST rate on detergent cakes has lessened from 18% to 5%; under HSN Code 3402, the rate on detergent powder will remain 18%. However, these products are substitutes, which fulfil the needs of the same consumer base, they cited.
In a notification, the Department of Consumer Affairs cited that the companies can specify the revised MRP till December 31, 2025, or until the old stocks are cleared, whichever comes earlier. Via stamping, stickers, or online printing, the revised MRP may be applied.
Read Also: MRP (Max Retail Price) Rules Under GST Act in India
The original MRP needs to be shown and cannot be overwritten, along with the difference between the old and revised cost, specifying merely the actual surge or reduction in the tax because of the GST revisions.
