GST rate cuts kick in, but cos advise consumer awareness

Ushering in Navratri, the nine days of festivity, 22 September will also mark a reset in household budgets, as consumption tax cuts will make everyday goods—from butter and paneer to hair oil and toothpaste—more affordable.

- Suneera Tandon

Earlier this month, the government moved to rationalize the goods and services tax (GST) rates in the country. The old 12% and 28% rates will be merged into 5% and 18%, with nil/exempt still in place. A 40% slab has been added for luxury and 'sin' goods such as tobacco, sweet aerated drinks and top-end cars.

While the full transition to the new tax slabs will take a fortnight, companies said the benefit to consumers will kick in immediately.

Companies are running large-scale campaigns to spread awareness about the new prices. Consumers may find some products at the old GST rates but they can ask retailers for the new rates, manufacturers said.

India's largest dairy cooperative, Amul, has revised prices for over 700 products, offering the full benefit of GST cut to customers. The list includes butter, ghee, UHT milk, ice cream, cheese, paneer, chocolates, bakery items, frozen snacks, condensed milk, peanut spread, malt-based drinks, etc.