The Central Government has always been upbeat about passing benefits from GST tax reduction to the end consumers. India’s GST has been witness to a number of prominent changes ranging from rate reduction to simplified ITR forms. In the latest round of GST amendments, the GST Council degraded a variety of white goods from 28% luxury tax slab to the lower 18% tax slab. In addition to this, the much talked and hyped sanitary napkins have been GST exempted by the Council. The tax exemption on Sanitary napkins is effective from July 27 onwards.
To ensure that the benefits from this tax reduction trickle down to the end consumer, the Centre has ordered the state metrology controllers to work in tandem with GST officers to cross-verify revised MRP of pre-packaged commodities. The Consumer Authority is all set to go into full action mode to check MRP-labels. Earlier, there were reports of companies not passing benefits to end consumers. This has attracted the eyes of the anti-profiteering machinery under GST too.
The instances of non-passing GST benefits to end users have not subsided completely. And following the recent reductions, the authority is all set to curb the ill practice at source also. ET it seems has learned a lot from past experiences. The Consumer Affairs Secretary read out the directive before the GST Council. The Legal Metrology Act directive says that companies/businesses can affix revised prices on the old products post the last ate slashing. Revised MRP declaration can be:
- Declared as a stamp or tapping a sticker on the Product. However, one should be careful that original MRP must be retained as it is. Companies must also advocate the impact of advertising and circulatory notes to pass benefits to registered taxpayers.
- However, the decision seems to impact the consumer goods industry most and the central government has extensively and exclusively directed transparent sharing of GST benefits. Some experts suggest that industry and specifically the consumer goods industry must ensure the passing of GST benefits from the company to the consumer.
