Political News

Govt approves GST anti-profiteering committee: Here’s how it will help consumers?

Dated Mumbai, November 18, 2017

Govt approves GST anti-profiteering committee: Here’s how it will help consumers?

Mumbai: With a vision to protect consumer interest, the Union Cabinet chaired by the Prime Minister Narendra Modi has given its approval for the creation of the GST anti-profiteering body.

The committee will ensure that the benefits of the reduction in GST rates on goods or services are passed on to the ultimate consumers by way of a reduction in prices.

Powers and functions of GST anti-profiteering body:

The GST Anti-profiteering body has the authority to act and tell the concerned business to reduce prices or undue benefit availed by it along with interest to the recipient of the goods or services.

If any consumer feels that the benefit of tax rate cut is not being passed on, then he can complain to the authority, Union minister Ravi Shankar Prasad said.

Affected consumers who feel the benefit of commensurate reduction in prices is not being passed on when they purchase any goods or services may apply for relief to the Screening Committee in the particular State.

However, in case the incident of profiteering relates to an item of mass impact with 'All India' ramification, the application may be directly made to the Standing Committee.

After forming a prima facie view that there is an element of profiteering, the Standing Committee shall refer the matter for detailed investigation to the Director General of Safeguards, CBEC, which shall report its findings to the NAA.

In the event, the NAA confirms there is a necessity to apply anti-profiteering measures, it has the authority to order the supplier/business concerned to reduce its prices or return the undue benefit availed by it along with interest to the recipient of the goods or services.

If the undue benefit cannot be passed on to the recipient, it can be ordered to be deposited in the Consumer Welfare Fund.

In extreme cases, the NAA can impose a penalty on the defaulting business entity and even order the cancellation of its registration under GST. According to the anti-profiteering rules, the authority will suggest a return of the undue profit earned from not passing on the reduction in the incidence of the tax to consumers along with an 18% interest, as also impose a penalty.

The constitution of the NAA shall bolster the confidence of consumers as they reap the benefits of the recent reduction in GST rates.

Who will head the NAA?

The NAA will be headed by a senior officer of the level of Secretary to the Government of India with four Technical Members from the Centre and/or the States

A five-member committee, headed by cabinet secretary P.K. Sinha, comprising revenue secretary Hasmukh Adhia, CBEC chairman Vanaja Sarna and chief secretaries from two states, has been entrusted to finalise the chairman and members of the authority.

The authority will have a sunset date of two years from the date on which the chairman assumes charge. The chairman and the four members of the authority have to be less than 62 years.

How will it help consumers?

According to Abhishek Jain, Partner – Indirect Tax at EY India, the GST anti-profiteering body would keep a check on the industry. “More importantly, the very presence of the anti-profiteering body will act as a deterrent for the industry to not indulge in malpractices,” Abhishek told Financial Express.

After the GST council slashed rates for mass consumption products, it is essential to have a regulatory. Early this week, some customers have realised that even after the government slashed GST rate on eateries to 5 per cent from 18 percent, the GST cut was not reflecting in their restaurant bill.

Angry customers took to the Twitter on Wednesday and lashed out at fast food chains McDonald's and Starbucks along with pictures of food bills before and after last week's GST cut.

Citing the government's decision to withdraw credit for taxes paid on raw material and rent, Starbucks, McDonald's and Domino's Pizza have already hiked the base price, while others like KFC are planning to follow the same by next week.

After the recent rate cut in 23rd GST Council meet, there are only 50 items which attract the highest tax of 28% under the goods and services tax (GST) regime and rates on many items have been cut to 5% as well.

Source: www.timesnownews.com