Godrej Consumer Passes On Benefit Of Lower GST Rates
Godrej Consumer cuts prices by 7-10 percent across various catergories.
Godrej Consumer Products Ltd. today cut prices of various products such as hair colour, liquid detergents and deodorants in the range of 7-10 percent following a reduction in the Goods and Services Tax rates.
These reductions will be effective immediately and would be applicable on the company’s existing stocks and distributor’s stock, Sunil Kataria, business head-India and SAARC at Godrej Consumer Products told BloombergQuint.
Kataria said some of revised rates were lower than in the pre-GST regime. For hair colour, the tax rate was around 26 percent ahead of the introduction of the new indirect tax regime and rose to 28 percent thereafter, he explained.
And now prices have come down to 18 percent, so we have taken all the benefits that have come to us as a result of this drop in rates and passed that to consumers.Sunil Kataria, Business Head-India and SAARC, Godrej Consumer Products
Several consumer goods companies, including ITC, Dabur, HUL and Marico have cut prices of various products to pass on the benefits of GST rate reduction to end-consumers after the GST Council, in its 23rd meeting on Nov. 10, decided to cut rates on more than 200 items. GST on hair colour and air fresheners have been cut to 18 percent from 28 percent earlier.
The price cuts come after Central Board of Excise and Customs Chairperson Vanaja Sarna wrote to consumer goods manufacturers asking them to immediately revise maximum retail price on all products and pass on lower GST rates to consumers.
The reduction in prices across various categories of products is expected to boost consumption and improve the consumer sentiment in both urban and rural market, Kataria added. The company intends to offer maximum support to retailers and wholesalers so that the switch to the new pricing is seamless and quick, he further said.
Speaking about stickering of stocks, he said, given the size of the Indian retail market of 9.5 million outlets, adding new MRP stickers are not possible, and hence the company would sticker stocks that are in the system now, and would communicate with retailers about passing on the benefits to consumers.
