The government has allowed retailers with unsold pre-GST stocks to stick new prices on them for sales, taking into account the post-GST changes. This means that companies have time till 30 September to clear unsold pre-GST goods with a revised MRP to be displayed along with printed sale price to reflect the changes post the new tax regime kicking- in.
The old MRP will have to be clearly on display along with the revised MRP sticker. But from 1 October, all pre-packed goods will have to have just one MRP including the GST.The old MRP will have to be necessarily displayed on the unsold inventories and the new rates can be reflected by way of stickers or through online printing alongside.
On items where the price has to be increased for unsold stocks, the manufacturer or packer or importer will have to give at least two advertisements in two or more newspapers informing people about the change.
MRP or Maximum Retail Price is the highest price that can be charged after including all taxes. But in case of some commodities, the tax rate has changed post Goods and Services Tax (GST), altering the MRP. This created a problem for several businesses which were left with large volumes of unsold pre-packed items when the GST came into force from 1 July.
The difference between the retail sale price originally printed on the package and the revised price “shall not, in any case, be higher than the extent of increase in tax” or in the case of imposition of fresh tax on account of the implementation of the GST, it said. “The original MRP shall continue to be displayed and the revised price shall not overwrite on it,” the notification said.
For reducing the MRP, a sticker of revised lower MRP (inclusive of all taxes) may be affixed and the same shall not cover the MRP declaration made by the manufacturer or the packer on the label of the package.
The notification also said that the packaging material or wrapper which could not be exhausted prior to 1 July may be used for packing of material till 30 September 2017. This will be permissible after the manufacturer or importer or packer makes correction in the retail sale price on account of the GST implementation by way of stamping or putting sticker or online printing.
However, after 30 September, the printed MRP on pre-packaged commodity will have to necessary include the GST rate and no add-on stickers would be allowed.
Several businesses were left with huge unsold inventories before the GST kicked in from 1 July. The unsold items had an MRP which included all taxes of pre-GST era but with the implementation of new regime, some of the final retail prices have undergone changes because of increase or decrease in tax incidences.
Food and consumer affairs minister Ram Vilas Paswan warned of legal action against manufacturers for not printing the revised MRP post rollout of the GST. “Fall in prices due to lower GST should be passed on to consumers. …The government will take legal action against vendors not declaring revised MRP after GST,” Paswan said.
Source by : business-standard