A significant restructuring of the Goods and Services Tax (GST) slab has brought a wave of optimism to the Indian retail sector. The nation’s shift to a celebratory ‘GST Utsav,’ coinciding with the festive seasons of Navratri and beyond, is being met with a positive outlook from businesses. This strategic move, aimed at making products more affordable and accessible, is expected to create a double bonanza for both consumers and the industry.
Also read: India’s GST Journey: From Gabbar Singh to Bachat
In an exclusive conversation with Marksmen Daily at the Retailers Association of India (RAI) CFO Summit, retail giant V-Mart’s CFO, Anand Agarwal, stated that the GST rate cut represents the government’s most significant tax relief for consumers. He noted the positive consumer response and increased footfall since the festive season began. To ensure the benefits are passed on immediately, changes have been implemented across all 500 V-Mart stores in 300 cities, with consumers being informed through various channels, including billing counters, in-store radio announcements, and display points. According to Agarwal, the categories set to benefit most are Fast-Moving Consumer Goods (FMCG), household items, white goods, and specific products across different segments.
The sentiment was echoed by Kaushal Parikh, CFO of Metro Brands, a company with eight banners including Mochi, FILA, and Crocs. Parikh pointed out that nearly 40% of their products are priced under ₹2,500, and the GST benefits are being passed on to customers through discounts and clear communication on billing and display boards. This direct transfer of savings is a key part of the industry’s strategy to capitalize on the new framework.
The new system, dubbed ‘GST 2.0’ by Retailers Association of India (RAI) CEO Kumar Rajagopalan, is a major step forward. He described it as the introduction of a cleaner, two-slab GST framework, moving towards simpler and fairer taxation. Rajagopalan anticipates that this reform will lower consumer prices, stimulate demand and consumption, and provide substantial support to the entire retail sector.
Since its rollout in July 2017, the GST system has absorbed 17 indirect taxes and 13 cesses. While it has undergone numerous rate revisions, this latest reform marks a major overhaul of the entire slab structure, simplifying the framework and enhancing its positive impact on the economy. The move is a deliberate effort by the government to streamline taxation and boost economic activity during a critical festive period.
