FMCG cos hail tax reduction, say will pass benefits to consumer
As many as 178 items of daily use were shifted from the top tax bracket of 28 per cent to 18 per cent.
New Delhi: Consumer product makers, including HUL and Patanjali, on Friday hailed the GST Council's decision to lower tax rates on commonly used items and said the benefits will be passed on to customers.
The Council on Friday reduced tax rates on over 200 items ranging from chewing gum and chocolates to beauty products and wigs and wrist watches to provide relief to consumers and businesses.
As many as 178 items of daily use were shifted from the top tax bracket of 28 per cent to 18 per cent while a uniform 5 per cent tax was prescribed for all restaurants, both air- conditioned and non-AC.
"This is a welcome step and would benefit the masses. Soap, detergent, toothpaste and shampoo etc are such articles which are used by people at large scale by all the sections of society, whether poor or rich," Patanjali Ayurveda CEO and MD told PTI.
He further said this would help people purchase their goods for daily requirement at lesser price.
"It is a welcome step which will benefit the consumers. HUL will be delighted to pass on the net benefits at the corporate level to the consumers," a Hindustan Unilever spokesperson said.
Items such as chewing gum, chocolates, coffee, custard powder, marble and granite, dental hygiene products, polishes and creams, sanitary ware, leather clothing, artificial fur and wigs have been kept under the 18 per cent slab.
Similarly, cookers, stoves, after-shave, deodorant, detergent and washing power, razors and blades, cutlery, storage water heater, batteries, goggles, wrist watches and mattress will also attract 18 per cent tax rate against 28 per cent earlier.
"This reduction will make these products more affordable and will certainly aid consumption. Marico has been very proactive in terms of passing on the benefits of lower GST rates to consumers," Marico Ltd CFO Vivek Karve said.
The company had reduced 5 per cent in hair oils and 3-4 per cent in saffola oils post GST rollout in July, he added.
"We are delighted with this very progressive step that the government has taken to reduce GST rates for products like ours that are consumed by the masses. We have always believed in keeping the interest of our consumers in mind and will pass on the benefits to them," a Mondelez India spokesperson said.
Mondelez India makes chocolates under brand name Dairy Milk, among others.