Act fast on GST rate cut or face action: Hasmukh Adhia

Finance secretary says onus of passing on the benefits is on companies

Hasmukh Adhia

Companies, including FMCG firms, might be prosecuted if their retailers do not immediately cut the prices of products whose goods and services tax (GST) rates have been slashed.

Union Finance Secretary Hasmukh Adhia says the retailers or the companies cannot continue with higher prices on grounds that the old stocks have not been exhausted.

“We have made provisions for the companies to claim the difference from the government as input tax credit. But I am not willing to accept their argument to postpone passing on the benefits to consumers till they have disposed of their old stocks.”

According to him, the new prices should be effective from November 15.

The GST Council in its last meeting this month cut the tax rate on 176 items from 28 per cent to 18 per cent and on two to 12 per cent.

There was a huge demand to make these cuts. Speaking in a Doordarshan interview in which Business Standard was present, Adhia, who is also revenue secretary, said it was inconceivable that a 10 per cent cut in the price of, say, detergent products should be minuscule for consumers.

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Tax kitty to exceed Budget estimate in 2016-17, says Arun Jaitley

Stands by decision to advance Budget date; many states seek loosening of fiscal deficit rule

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While some states have complained of declining tax revenues due to demonetisation, the Centre is hopeful of exceeding its Budget 2017 Estimates (BE) for 2016-17 in both direct and indirect tax collections.

It has reiterated the decision to advance the Budget presentation date to February 1, despite objections.

“We will end this year with higher revenues for both direct and indirect taxes compared to the estimates,” said Finance Minister Arun Jaitley after the Goods and Services Tax Council meeting and pre-Budget consultation with state counterparts.

The states raised concern over declining revenues and sought relaxation in the Fiscal Responsibility and Budget Management (FRBM) limit, beside central support to revive labour-intensive industries.

To a query, Jaitley said the Reserve Bank (RBI) would remove the current restrictions on cash withdrawal after assessing the situation. He ruled out a change in the conditions barring anyone other than non-resident Indians (NRIs) and those returning from abroad from depositing the junked notes in select central bank branches.

“Actions are taken in phases and so are relaxations,” he said on when the cash withdrawal restrictions could be ended. Read Full Story >>>

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