India is set for its biggest Goods and Services Tax overhaul since the landmark rollout on July 1, 2017. From September 22, the GST Council’s decision to simplify the regime kicks in: just two slabs will remain, 5 percent on most common-use items and 18 percent on everything else. The 12 percent and 28 percent slabs have been scrapped, covering 375 items.
The move, taken unanimously by the Council of Centre and states, is expected to both simplify compliance and lower costs for consumers.
CBIC’s stance: pass it on to the consumer
Speaking to PTI, Central Board of Indirect Taxes and Customs (CBIC) chairman Sanjay Kumar Agarwal said the board will closely monitor whether companies reduce prices in line with the lower tax rates.
“We are confident that the industry will pass on the benefits to the ultimate consumers, and in case there are any complaints received by us, we will take it up with the industry bodies,” Agarwal said.
He noted that in previous rounds of GST cuts, competitive market pressures had ensured that reductions were passed down to buyers.
Anti-profiteering lessons from the past
Agarwal recalled that during the major rate cut exercises of 2017, 2018 and 2019, very few formal complaints were filed with the anti-profiteering authority.
“That gives the impression that mostly the benefits were passed on by the industry to the end consumers. So, we are not expecting a different situation this time,” he told PTI.
The GST law requires businesses to pass on tax cut benefits. The anti-profiteering authority was created as a safeguard, allowing consumers to submit invoices and bills if prices did not reflect lower GST rates.
Track record of profiteering complaints
Between 2017 and now, only 704 complaints were registered under the mechanism. Around 60 percent of these came within the first three to four years of implementation. The total profiteering amount alleged across these cases stood at Rs 4,362 crore.
With the system now stabilised, the government has announced March 31, 2025, as the sunset date for filing new profiteering complaints.
