FMCG, appliance cos to pass on GST cuts

Transitioning to new packs with revised prices could be a challenge for soap and biscuit makers

- Suneera Tandon

Price cuts, promotions and packs with a little extra in them—that's broadly how FMCG and appliance companies plan to pass on the benefit of GST rate cuts announced Wednesday evening to consumers.

Makers of fast-moving consumer goods, which have seen the biggest benefit with GST on items of daily use coming down from 12-18% to 5%, said they'll lower the prices of large pack sizes or offer promotions. However, prices of products priced in the ₹5 to ₹20 range will be retained, while adding extra grammage in them.

Manufacturers of home appliances such as television sets and air-conditioners are more likely to spruce up promotions later in the month and pass on the benefit of lower GST to consumers.

For makers of soaps, biscuits and shampoos, transitioning to new packs with revised prices could be a challenge in the short run.