Govt puts ecommerce players under vigilance over GST pass-through

Tax officers are checking if the GST rate cuts are being passed on to customers by comparing prices before and after September 22

The government has placed ecommerce platforms under vigilance to ensure that recent goods and services tax (GST) rate cuts on essential items and fast-moving consumer goods (FMCG) are passed on to consumers.

 

Sources said authorities had received complaints that prices of some items went up on ecommerce platforms even after the GST rate cuts took effect on September 22. Tax officers are checking

 

if these cuts are being passed on to customers by comparing prices before and after the new rates kicked in, said a source familiar with the matter.

 

“One of the ecommerce majors initially showed higher prices after the GST rate cuts, citing a technical glitch, but later corrected them,” a source said. While the sources did not name any platforms, one large ecommerce firm publicly detailed its steps. A Flipkart spokesperson said the company rolled out backend tech changes to auto-update GST slabs, conducted seller training and webinars, and launched a GST Bachat Utsav storefront to highlight tax savings. It said sellers had passed on GST benefits of ₹200 crore to Flipkart customers.

 

“Flipkart has taken several communication and tech-enhancement measures to ensure that the GST reductions are passed on to customers, by sensitising seller partners and providing a simplified seller dashboard with automatic backend update of the new GST slabs, thereby making it easier for them to adopt the changes,” the Flipkart spokesperson said in reply to a query. 

 

Consumer Affairs Secretary Nidhi Khare on Monday said the National Consumer Helpline received around 3,000 GST-related complaints since the latest round of tax reductions took effect. “We are sending these complaints to the Central Board of Indirect Taxes and Customs for further action,” she told reporters.

 

Under the revised GST rate structure, most goods now fall either under the 5 per cent or 18 per cent slab. While some are exempt, a few categories fall under the 40 per cent slab.

 

Items attracting zero GST include ultra-high-temperature milk, packaged paneer, all forms of Indian breads (roti, paratha, khakhra), and packaged snacks. Goods now taxed at 5 per cent include daily-use personal-care items like shampoo, soap, and toothpaste; baby-care products such as diapers and feeding bottles; and medical devices such as thermometers and diagnostic kits.

 

Electronics, appliances, and small vehicles have also seen rate cuts: Televisions above 32 inches, air conditioners, motorbikes up to 350 cc, and small cars now attract 18 per cent GST, down from 28 per cent.

 

Earlier this month, the finance ministry had directed Central GST field officers to track the impact of the tax cuts. In a September 9 communication, officers were asked to submit monthly reports on price changes for 54 commonly used items. The first such report, comparing maximum retail prices before and after the rate cuts, is due by the end of September.