The government has written to all major fast-moving consumer goods (FMCG) companies urging them to immediately revise the maximum retail price on all their products that have seen a reduction in tax rates as decided by the Goods and Services Tax Council.
The letter comes a couple of days after Finance Secretary Hasmukh Adhia, speaking on Doordarshan, warned FMCG companies that they could attract anti-profiteering action if their retailers failed to pass on the newer prices to consumers.
The Cabinet, last week, also approved the creation of the National Anti-profiteering Authority, which is tasked with ensuring that the benefits of GST, where applicable, are passed on to the consumers.
“Ms. Vanaja N. Sarna, Chairperson, Central Board of Excise & Customs (CBEC), has addressed a letter to all the major Fast-Moving Consumer Goods (FMCG) companies pointing out the need to immediately revise the MRP on all the products in which the reduction of GST has been announced by the Council,” the Finance Ministry said in a statement on Monday. “She has also requested all to give wide publicity to the revised MRP of products.”
The GST Council, in its 23rd Meeting held on November 10, had slashed the tax rates on about 200 goods, including 178 that fell in the highest tax bracket of 28%. A large number of other goods saw their tax rates reduced from 18%, 12%, and even 5%.
“All these changes are effective from the midnight of November 14, 2017,” the statement added. “The benefit of reduction in the GST rate has to be passed on by the suppliers to the consumers by way of commensurate reduction in prices. The reduction in GST rates is also expected to encourage domestic demand and investment.”
Piyush Goyal with shadow chancellor Rachel Reeves (centre), Vikram Doraiswami and other officials at the India Global Forum
And , Goyal with Jonathan Reynolds