In a move aimed at ensuring the businesses pass on the benefits of GST rate cuts to consumers, officials from the government have begun field inspections, confirmed a source from the Ministry of Finance. According to people aware of the development, ministry teams have been visiting retail outlets and other markets over the past few days, purchasing a range of goods to check if the revised rates reflect on the final price of the items.
“Officials from the ministry are keeping a check on the market and buying stuff to see who all have passed on the rates,” said the official from the Ministry.
With GST 2.0 being effective from September 22, businesses have been instructed by the Ministry to pass on the reduced rates of GST from that day onwards. While the GST Council announced the two rate structure on September 3, they were given a time period of two weeks to update maximum retail prices (MRPs) and pass on cost benefits to consumers from September 22. Businesses unable to update the MRP labeling need to ensure the new prices are being implemented.
While the new GST rates are coming into effect from September 22, several retailers are still struggling to pass on the new rates to the consumers as most of them have items piled up in their stocks for a few weeks. Several sectors like pharma and textiles have approached the government to seek alternative ways to address the challenges of inverted duty structure that they might face, with two slabs of GST being implemented.
According to the finance ministry source, the government is still working to figure out what will be the potential pain points for the business in terms of passing on the new rates and other reforms that have been implemented under GST 2.0. However, the source also confirmed that the Ministry is well aware that several retailers particularly in pharma sector might take a longer time to pass on the new rates to the consumers as a majority of the retailers, especially the smaller ones are not registered under GST system and most of them have items stocked up which were bought in older rates. However, with the wholesaler and distributors selling the products at new tax rates, the retailers will be able to pass on eventually.
Source from: https://www.newindianexpress.com/business/2025/Sep/24/gst-rate-cut-benefit-officials-keeping-close-watch-on-retailers
