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Government takes new measures against GST profiteering

Published
today Jun 24, 2019
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The government is cracking down on goods and services tax profiteering following several high profile cases and has instructed its GST officers to conduct mock purchases to find businesses failing to pass on tax cut benefits to the consumer.

The government is taking extra measures to crack down on GST profiteering


The government will use the Central Goods and Services Tax Act to collect evidence against businesses that are profiteering by failing to lower prices following GST rate cuts, TNN reported. The newly-elected government has launched a new anti-profiteering drive and this will include the formation of anti-profiteering cells focused solely on the task.

GST officials have been given a target of identifying 20 suppliers each that are failing to pass on GST benefits. The officers will look at business to business invoices in order to check how businesses have handled GST rate cuts. 

A number of high-profile cases have seen businesses reprimanded for GST profiteering or failing to adhere to regulations. P&G India, which retails brands including Olay, Pantene, and Head & Shoulders, was found guilty of profiteering in April this year by the Directorate General of Anti Profiteering but protested its innocence. A Johnson & Johnson distributor was found guilty of the same in December last year. 

The DGAP is tasked with passing on its findings to the National Anti-Profiteering Authority which decides the appropriate action to be taken. There have been numerous complaints from businesses over confusion concerning how to pass on GST benefits.

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