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Informist, Thursday, Sept. 4, 2025

 

--Revenue secy: Will be engaging with industry to ensure GST cut is passed on 
--Revenue secy: Expect industry to pass on benefit of GST rate cuts 

 

NEW DELHI – The GST Council expects companies to pass on the benefits of reduced goods and services tax to the end consumer in the absence of any anti-profiteering mechanism, Revenue Secretary Arvind Shrivastava said Wednesday. "Lot of industry has already come out and have committed that they would be transmitting the benefits," Shrivastava said in a press conference after the 56th GST Council meeting.

 

"Administratively, both at state-level as well as Central Board of Indirect Taxes and Customs level, we will definitely be engaging with the industry and seeing to it that the benefits are transmitted to the consumers. We do expect that since it is to the benefit of businesses, too, it is going to happen eventually," Shrivastava said.

 

At its landmark meeting Wednesday the GST Council approved a two-slab goods and services tax rate structure, with a new special tax of 40%, to be effective from Sept. 22. The GST Council approved the two-tier rate structure of 5% and 18%.

 

"Since inception, under the arrangement for anti-profiteering, which is no longer in place now, only 704 cases were registered with the authority. And 60% of the cases were initiated within the first 3-4 years of implementation. Total profiteering that was alleged was around INR 43.62 billion in these 704 cases. So we expect that last time, too, industry has largely passed on the benefits of rate cut," Shrivastava said.

 

The risk of profiteering is acute as there have been occasions in the past when cuts in tax rates announced by the GST Council have not been passed on to consumers. Instead, companies have increased their profit margins. In November 2017, after the council reduced GST rates on restaurants to 5% from 18% and 12%, anti-profiteering investigations were initiated against some restaurants for allegedly not passing on the benefit of reduced taxes to customers.

 

After the GST regime was rolled out in June 2017, the government had set up the National Anti-Profiteering Authority in November 2017 to check unfair profiteering by manufacturers and suppliers. The role of the authority included recommending punitive action against violators. The National Anti-Profiteering Authority was subsumed with the Competition Commission of India on Dec. 1, 2022, and then the competition watchdog passed on the baton to the principal bench of the GST Appellate Tribunal to hear anti-profiteering complaints.

 

The GST Council had, in its 53rd meeting, decided to introduce a sunset date for filing anti-profiteering cases to give businesses the autonomy to set prices for goods and services without the fear of being investigated for being in breach of anti-profiteering provisions. Under the anti-profiteering provisions of the GST law, it was mandatory for suppliers of goods and services to pass on the benefit of any reduction in the rate of tax, or the benefit of input tax credit, to recipients by way of a commensurate reduction in prices.  End

 

Reported by Sagar Sen and Priyasmita Dutta

Edited by Deepshikha Bhardwaj

 

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