In a major relief for retailers, manufacturers and importers, who recently were in a tizzy as the government had changed GST rates on a whole host of items from July 18 onwards, the Ministry of Consumer Affairs has approached all states and UTs with a prescribed format to exhaust the existing stock without much hassle.
The letter, written by the Legal Metrology Department Centre to the state and UTs controller of Legal Metrology, informs them about the impact of the recent GST changes. The Consumer Affairs Ministry has allowed retailers to exhaust existing stock of pre-packaged and labelled items products by January 2023/till the stock is exhausted.
Retailers have also been allowed to declare revised MRP on the unsold stock packed prior to GST rate revision.
The guidelines also state that the stock should be sold by way of stamping or putting sticker or online printing after complying with prescribed conditions and the original MRP shall continue to be displayed and the revised price shall not overwrite it.
In cases where there is a reduction in GST, the government has categorically stated that due to reduction of taxes, the revised price shall not be higher than the extent of price after reduction of tax.
The companies, manufacturers and retailers have also been told that they should make at least two advertisements, for one or more newspapers, and also circulate notices to the dealers and to the Director of Legal Metrology and Controller of Legal Metrology in the states, indicating change in prices on package.
Experts see the above move as a major relief as it will not lead to any major recalls of the old/existing stocks by the manufacturers or sellers to come up with a fresh packaging.
| Product name | Rate up to 17 Jul'22 | Rate w.e.f. 18 Jul'22 |
| Curd, Lassi, Buttermilk, pre-packaged and labelled | Nil | 5% |
| Jaggery of all types including cane (gur), palmyra, pre-packaged and labelled; khandsari sugar, pre-packaged and labelled | Nil | 5% |
| Puffed rice, commonly known as Muri, flattened or beaten rice, commonly known as Chira, parched rice, commonly known as khoi, parched paddy or rice coated with sugar or gur, commonly known as Murki, pre-packaged and labelled | Nil | 5% |
| All Goods, including printing ink, writing or drawing ink and other inks, whether or not concentrated or solid, fountain pen ink, ball pen ink | 12% | 18% |
| Orthopaedic appliances, such as crutches, surgical belts, and trusses; Splints and other fracture appliances; artificial parts of the body; other appliances which are worn or carried, or implanted in the body, to compensate for a defect or disability; intraocular lens | 12% | 5% |
| Ostomy appliances including pouch or flange, stoma adhesive paste, barrier cream, irrigator kit, sleeves, belt, micro-pore tapes | 12% | 5% |
"A big relief to the industry which results in saving of additional cost to be incurred on packaging material or wrapper due to the change in GST rates on pre-packaged and labelled goods including MRP products," said Anita Rastogi, partner, GST and indirect taxes at PwC.
Rastogi said that there are products which are for the first time charged to GST, with effect from, July 18, 2022, for example pre-packaged and labelled curd, lassi, buttermilk, jaggery, puffed rice etc. These products would be unsold at various stages of the supply chain on July 18, for example — goods manufactured and still to be sold to distributors, unsold stock with distributors or retailers which would bear the rate existing up to July 17.
"On such unsold stock, albeit the GST, is now applicable and hence the consequent price would increase, this instruction guides that mere declaration of changed MRP by way of stamping, putting sticker or online printing would suffice. This would mean that a completely new packaging material or wrapper is not required. Similarly in case of products where the GST rate has dropped, for example, specified Orthopaedic appliances, the MRP needs to be reduced," Rastogi added.
First Published: Aug 4, 2022 6:17 PM IST
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