The government today asked industry to hold back price increases till GST roll out from July 1, saying such hikes might later lead to inquiry of balance sheet by a specified authority. Revenue Secretary Hasmukh Adhia said that anti- profiteering provision in GST laws was essential to ensure that the benefits of reduction in tax incidence is passed on to consumers, and the tax department will persuade the big corporates not to do any profiteering. “My suggestion to all of them would be for the time being, till GST is rolled out, if they can hold back price increases. Unless it is a serious issue of cost increase, which they cannot absorb immediately. Otherwise hold on for sometime.
“But still if you have to absorb your cost and you have to do it then it is a matter of inquiry subsequently,” Adhia told CNBC TV18.The GST Act includes the provision of setting up an anti-profiteering authority to ensure that companies pass on the benefit of tax reduction to customers. “The authority entrusted with inquiry of anti profiteering they can go into the balance sheet of the companies, they can look at their cost sheets and then decide. It is a matter of enquiry and investigation,” Adhia said. The GST Council had last week fitted over 1,200 goods and 500 services in tax bracket of 5, 12, 18 and 28 per cent. The government estimates that despite the higher standard rate of 18 per cent, service providers will get input tax credit that will lower the effective incidence of GST to around the current incidence of 15 per cent.
via Hold back price hikes till GST roll out: Hasmukh Adhia tells India Inc – The Financial Express
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