Some of the country's biggest automakers and retailers announced price cuts as Asia's third-largest economy switched to a new nationwide sales tax, replacing a host of provincial and national levies. The Goods and Services Tax (GST) unifies the $2 trillion economy and 1.3 billion people into one of the world's biggest common markets. FMCG major Hindustan Unilever (HUL)
has reduced the prices of some of its detergents and soaps, extending the tax benefits the company has got under the GST regime to consumers. The company has slashed the price of its detergent soap Rin
bar of 250 gm to Rs 15 from Rs 18 and increased weight (grammage) of its Surf Excel
bar costing Rs 10 to 105 gm from 95 gm at the same price.
Hypermarket Big Bazaar
, owned by Future Retail Ltd, announced discounts of 2 percent to 22 per cent on groceries and household supplies across its stores in 26 states. Fashion portal Myntra, part of online retailer Flipkart, was also offering GST discounts.
As the reforms set in, e-commerce players are optimistic that more tax benefits will come in within the new tax regime, which will be shared with the consumers.
"Earlier, we were not able to take tax credit for many things. Now when we are able to take these, there is definitely some saving from the cost side also. If we have more margin, then we should pass it on to the consumer and we are definitely doing that," Vishwas Shringi, founder of Voylla Fashions, told IANS.Maruti Suzuki
, Toyota Kirloskar JLR and BMW reduced the prices in the range of Rs 2,300 to over Rs 2 lakh of different models to pass on to consumers the benefit of lower tax incidence under the GST regime.Here are the few price changes announced so far:
People planning to purchase white goods will have to shell out more money as most appliances and durable makers have increased their prices in the new tax regime under GST.
Durable makers would also go for another hike before the festive seasons as the industry is considering a price revision based on input credit, when their existing stock of raw materials and components would replenish.
"For our sector, the net tax would go up. The current tax rate is around 25-27 per cent and would go to 28 per cent. Therefore, immediately the consumer price, which is market operating price, would go up if brand and dealers want to retain the same margin," said Godrej Appliances Business Head and Executive Vice President Kamal Nandi.
Videocon COO C M Singh echoed similar views. "Once we start getting input credit from the freshly purchased raw material, which would happen down the line in two months, then we would have price at the same level as pre GST days," Singh said.
Maruti Suzuki India (MSI) has slashed prices of most of its models by up to 3 per cent with immediate effect except for diesel versions of sedan Ciaz and MPV Ertiga with mild hybrid technology, which saw increase in prices by over Rs 1 lakh.
It has cut the price of Alto in the range of Rs 2,300 to Rs 5,400, WagonR Rs 5,300-Rs 8,300 and that of Swift between Rs 6,700 and Rs 10,700. It has also reduced the price of Baleno in the range of Rs 6,600 and Rs 13,100. The company has also reduced the price of Dzire, ranging between Rs 8,100 and Rs 15,100. Price of Ertiga petrol has been cut by up to Rs 21,800 while that of petrol powered Ciaz by up to Rs 23,400.
Toyota Kirloskar Motor also announced slashing prices ranging between Rs 10,500 and Rs 2.17 lakh (ex-showroom Bengaluru). The company said it has reduced prices of all new Fortuner by up to Rs 2.17 lakh, Innova Crysta by up to Rs 98,500 and Corolla Altis by up to Rs 92,500. It has also lowered the prices of Platinum Etios by Rs 24,500 and that of Etios Liva by up to Rs 10,500.
Tata Motors-owned Jaguar Land Rover has reduced prices of its entire vehicle range in India on an average by 7 per cent to pass on the benefit of reduced tax under GST.
BMW has also cut prices of its models, ranging from Rs 70,000 on base end version of X1 to Rs 1.8 lakh on the top end of its sedan 7 series.
Also, tech giant Apple
has announced a reduction in the maximum retail prices of iPhone, iPad, Apple Watch, and Mac line of computers across the board, with a few exceptions.