GST cut: Centre monitoring price reduction by e-comm platforms

New Delhi: The Union government is closely monitoring whether consumers are receiving the benefit of Goods and Services Tax (GST) reductions on fast-moving consumer goods (FMCG) sold through e-commerce platforms, sources said on Tuesday.

The move follows complaints that prices of several essential products have not dropped in line with the recent tax changes.

“We are monitoring the price changes. Field formations are monitoring, and we will get the first report from them by September 30,” a source said. The official added that authorities intend to avoid “a knee-jerk reaction” while examining the issue.

With effect from September 22, the GST system was streamlined into two slabs—5 per cent and 18 per cent. The earlier structure of 5, 12, 18, and 28 per cent was consolidated, leading to lower levies on nearly 99 per cent of commonly used items. This restructuring is expected to translate into reduced retail prices across categories.

Although the formal anti-profiteering framework has not been activated for these complaints, the government is closely monitoring price movements. Officials noted that several companies have voluntarily assured that they are passing on the benefits of lower tax rates to consumers.

Earlier this month, on September 9, the finance ministry directed Central GST officers to prepare monthly reports on price variations for 54 widely used items. These include butter, shampoo, toothpaste, tomato ketchup, jams, ice cream, televisions, air conditioners, diagnostic kits, thermometers, bandages, crayons, erasers, cement, and many other products. The reports, comparing Maximum Retail Price (MRP) changes brand-wise, are to be submitted to the Central Board of Indirect Taxes and Customs (CBIC).

The findings from the first such assessment, due by the end of September, will provide the government with a clearer picture of how the tax cuts are being reflected in consumer prices.