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GST rate cut: FMCG firms set to reduce prices, pass benefits to consumers

We welcome this step by the government and will pass on the benefits to the consumers: P&G spokesperson

Press Trust of India  |  New Delhi 

FMCG, consumer goods
HUL remains committed to passing on the benefits of GST reduction to the consumers

With the revised rates coming into force from today, majors such as (HUL) and said they are in the process of reducing prices of commonly used items to pass on the benefits to consumers.

In a relief to consumers and businesses, the Council last week reduced tax rates on over 200 items, ranging from shampoos to detergent, chewing gum, chocolates and beauty products.

"remains committed to passing on the benefits of reduction to the consumers. We are reviewing all our networks so that we can commence production of products with lower prices as soon as possible," an spokesperson told PTI.

In many cases the production with lower prices will commence this week itself and price changes will be communicated in due course, he added.

While putting revised prices on the products would take some time, the companies have asked their channel partners to reduce prices in line with the steep reduction in the rates.

Large have started advertising the downward revised prices of items on account of reduction in tax rates.

The tax rate on items such as coffee, custard powder, dental hygiene products, polishes and creams, sanitary ware, aftershave, deodorant, detergent and washing power, razors and blades, has been cut from 28 per cent to 18 per cent.

"We welcome this step by the government and will pass on the benefits to the consumers," a spokesperson said adding that the company looks at as a positive reform and will benefit the Indian economy and the industry in the long term.

The companies, however, declined sharing the product-wise price reduction.

Other items on which tax rate has been cut from 28 per cent to 18 per cent include detergents, shampoos, hair cream, wire and cables, furniture, mattress, trunk, suitcase, hair dyes, makeup, fans, lamp, rubber tubes and microscope.

"is a transformational reform. The recent changes augur well for consumers. We are evaluating the implications given our wide portfolio of products," an spokesperson said.

Earlier, chocolate maker Mondelez India said keeping the interest of consumers in mind the company will pass on the benefits to them.

The Council on November 10 announced shifting as many as 178 items of daily use from the top tax bracket of 28 per cent to 18 per cent.

While few items were shifted from 18 per cent bracket to 12 per cent, some other were moved from 12 per cent to 5 per cent. The revised rates on the products and services are effective from today.

First Published: Wed, November 15 2017. 21:24 IST