Realty, FMCG firms face profit taint after GST implementation, says National Anti-Profiteering Authority

NEW DELHI:  People are being duped by firms, months after the rollout of the Goods and Services Tax (GST). The National Anti-Profiteering Authority (NAA) that was recently set up by the government has started receiving a lot of complaints of profiteering after GST. 

The maximum complaints are against real estate companies and the FMCG sector, that range from the selling of goods at the maximum retail price (MRP) that does not reflect the revised GST rates, charging  GST above the MRP, input tax credit received by a business not being passed on to the end consumer among others.

BN Sharma, chairman, NAA said though over 250 complaints were received on the NAA website within a few days of it being operational, a majority of the people lack awareness. 

“Lack of awareness is the main reason behind undue profiteering by some companies. We believe public outreach has to be a little more. There are many states like Maharashtra, Karnataka and UP from where there are no complaints. How can it be possible? Either the people are unaware or they don’t want to report the matter. There is strong need of IEC (information, education and communication) activities,” he said. 

NAA has partnered with an online community platform Local Circles to reach out to consumers and over 60,000 Indians are now connected to NAA via its online community “Anti-Profiteering.”

The community enables people to report profiteering, thereby making GST compliance a true citizen-government partnership. Officials said the NAA is committed to minimizing profiteering under GST regime and quick action against erring firms.

Based on people’s response, state and local online communities for anti-profiteering may also be rolled out.

For example, if the case reported is that of a national restaurant chain, it may be reported in the national community, while if it is state or a local restaurant, it may be reported on state/local online communities.

Profiteering by companies:

• Maximum complaints from real estate, FMCG sectors.
• People are still unaware of profiteering and there is a need for public outreach.
• Online platform Local Circles will forward the complaints to the NAA for further action
• Types of complaints.
• Selling of goods at MRP that does not reflect the revised GST rates.
• Charging of GST above MRP.
• Receipt of input tax credit by a business but not passing it to the end consumer.