Govt Warns Firms Against Not Passing GST Cuts To Consumers

2025-09-22 06:15:21

(MENAFN- IANS) New Delhi, Sep 22 (IANS) Consumer Affairs Secretary Nidhi Khare on Monday warned companies that they will face strict action if they fail to pass on the benefits of reduced Goods and Services Tax (GST) rates to consumers.

In an interview with NDTV Profit, Khare said that any company not reflecting the revised GST rates in their prices will be treated as indulging in“unfair practice.”

She added that the government is fully equipped to monitor compliance.

“If we feel reduced GST hasn't been passed on, it will be treated as an unfair practice. We will take class action against those who don't pass on GST benefits,” she said, assuring that consumer complaints will also be addressed promptly.

The warning comes as the new GST structure came into effect on Monday, reducing taxes on around 370 items, including essential goods and lifesaving medicines.

Finance Minister Nirmala Sitharaman had earlier said that the new system aims to inject nearly Rs 2 lakh crore into the economy by boosting the spending power of households.

Everyday food products such as UHT milk, paneer, chapatis, parathas, butter, biscuits, namkeen, ketchup, and juices have become cheaper under the revised structure.

Toiletries like soaps, shampoos, and hair oil, along with stationery items such as notebooks and pencils, now attract no GST.

Essential drugs for cancer and rare diseases have been exempted, while the GST rate on diagnostic kits and glucometers has been reduced to just 5 per cent.

Cement for housing has also seen a major cut, dropping from 28 per cent to 18 per cent. Even services such as salons, gyms, and yoga classes now come under lower GST brackets.

However, items such as tobacco, pan masala, and aerated beverages remain in the highest tax category at 40 per cent, while large SUVs and MPVs have also been brought into the same bracket to offset revenue losses.

With prices of essentials, medicines, and household goods falling, officials say that the move is expected to improve consumption and boost the economy in the coming months.

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