Consumers want brands to ensure retailers pass on GST benefits; avoid 2018-19 repeat: LocalCircles survey

Amid expectations of a festive demand boost from GST rate cuts, a LocalCircles survey on Thursday revealed that 8 in 10 consumers want brands to enforce mechanisms that ensure retailers pass on these benefits.

This comes after only a fifth of the surveyed participants said they had received GST benefits during the 2018–19 rate revisions. Survey participants stated that much of the benefits then did not reach them, as manufacturers, distributors, and retailers failed to pass them on.

“Only 18% of consumers surveyed believe that GST rate reduction benefits were passed to them post the 2018-19 rate rationalisation exercise while 50% believe manufacturers/brands or distributors/stockists/retailers did not lower MRPs or pass discounts to them,” the survey said.

The central government, however, anticipates that 90% of these GST benefits will be passed on to the end consumers. It is anticipated that over 15% price reduction is expected for both consumer durables and automobiles, including two-wheelers.

The Department for Promotion of Industry and Trade (DPIIT) also has asked enterprises to revise the price labels, highlighting the discounts in effect to GST rate cut.

However, most customers fear if this will happen this time.

Just yesterday, manufacturers and importers received major relief as the Department of Legal Metrology allowed the use of old packaging with existing MRP labels until March 31, 2026, or until stocks last, whichever comes first.

Customers fear that this could limit their ability to receive the full rate reduction benefits, as they remain entirely dependent on retailers to pass them on.

The survey received over 36,000 responses from consumers located across 319 districts of the country, with a little than two third respondents being male and remaining being female, with majority of the respondents hailing from Tier 1 and 2 cities.

“Given that the anti-profiteering authority is no longer in existence and no mandate has been issued under the Consumer Protection Act 2019 to classify not passing benefits as unfair trade practice, the reliance literally is on brands now to ensure the reduced rates are passed by the retailers to the end consumers,” the survey report said.