GST Reforms: FM Nirmala Sitharaman Confirms Benefits of Rate Cuts Reaching Consumers; Government Monitors Prices of 54 Items
The recent Goods and Services Tax (GST) reforms are already benefiting consumers across India through noticeable price reductions, according to Finance Minister Nirmala Sitharaman. Speaking at a press conference during the GST Bachat Utsav on Saturday, the Finance Minister emphasized that the government's efforts have resulted in lower prices, leading to higher consumer purchases nationwide.
GST Rate Cuts and Impact on Prices
Since September 22, the GST regime has undergone significant changes, with rates on 375 items reduced from four slabs—5%, 12%, 18%, and 28%—to just two slabs—5% and 18%. This simplification and reduction have translated into price drops for nearly 99% of daily-use products such as toothpaste, shampoo, cars, and televisions.
Minister Sitharaman noted that the effects of these cuts are measurable and tangible in the market. Companies, in many cases, have passed on savings to consumers beyond the average GST rate reduction, indicating a genuine consumer-friendly approach.
Monitoring and Handling Complaints
To ensure transparency and accountability, the government has been closely monitoring price changes on a selected 54 items. The Department of Consumer Affairs has received a total of 3,169 complaints related to the non-reduction of prices consistent with the GST cuts. Of these, 3,075 complaints were forwarded to the Central Board of Indirect Taxes and Customs (CBIC) for action.
So far, 94 complaints have been resolved, and to further streamline grievance redressal, the department plans to introduce a new functionality on its grievance portal. This feature will allow complaints to be directly forwarded to the chief commissioners of the respective CBIC zones, thus expediting resolution.
Positive Effects on Electronics Sector
Union Minister for Electronics and IT, Ashwini Vaishnaw, highlighted the positive repercussions of the GST cuts on the electronics sector. Sales data from retail chains indicate a 20-25% increase in sales compared to the last Navaratri festival period. Notably, categories such as 85-inch televisions witnessed complete sell-outs.
Vaishnaw added that India's electronics manufacturing industry, which already boasts a double-digit compounded annual growth rate (CAGR), is expected to accelerate further. The increased consumption driven by GST cuts is projected to generate an additional Rs 20 lakh crore in sales this year compared to the previous year.
Conclusion
The recent GST reforms stand out as a significant step toward simplifying tax structures, reducing the burden on consumers, and stimulating demand across multiple sectors, notably daily essentials and electronics. With ongoing government monitoring and consumer protections in place, these reforms are poised to sustain the momentum of increased consumption and economic growth in India.