Thiruvananthapuram: After the Goods and Services Tax (GST) came into effect, the prices of items with lower tax rates have gone down, but traders are allegedly refusing to cut prices on new stock arrivals.
Though the state government had released a list of 101 essential commodities, whose prices should have come down following the implementation of GST, the merchants ignored the instructions. They have also kept the prices of freshly procured products unchanged, refusing to adopt the pricing protocol prescribed by the GST regime.
Citing legalities, the state GST department has not initiated any comprehensive action so far to stop producers and distributors making the most of GST or pass on the benefits to consumers.
The government’s efforts to rein in prices of hotel food have also made little headway despite marathon meetings with restaurateurs.
Hoteliers claimed that they were under tremendous pressure to hike prices of food and beverages because of the sharp increase in prices of various commodities, especially that of chicken.
With the reduced tax, a bottle of drinking water should cost at least Rs 1 lesser, but the maximum retail price remains Rs 20 per bottle despite the arrival of fresh stocks after the GST rollout.
The state government had declared that the prices of essentials would moderate from July 1. They include atta and maida (by 6 percent), sugar (4 percent), tea, coconut oil, gingelly oil, sesame oil, and spices such as elachi, clove, and cinnamon. However, though once month has passed since the implementation of GST, the prices of all these items remain the same, if not higher.
Nevertheless, the merchants have hiked the prices of items with increased tax rates under the GST when fresh stocks arrived.
Some of the leading consumer goods manufacturers have decided to lower the prices of commodities such as toothpaste, milk powder, washing powder etc. Whereas, many of the other companies continue to sell the same products at older rates.
There have been complaints galore from the public over jacked up prices, over billing, masking or tampering with stickers to the state GST department and the minister concerned. Though finance minister Thomas Isaac had promised to intervene in the issue, no action has been initiated against erring merchants so far.
At the same time, the government has received memorandums from different industrial sectors seeking reduction of tax rates.
At the GST Council meeting scheduled for August 5, the minister would urge the government to consider their demands, including tax reduction, it is learnt. The main demand would be to bring tax on sanitary napkins, fishing equipment, ayurveda medicines, plywood products etc to 5 percent.
Apart from this, a proposal to constitute a panel under governments in each state to monitor the implementation of GST and prevent malpractices/irregularities in the name of the new tax regime would also be put forward at the meeting.
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