The government wants to ensure that the benefits of the Goods and Services Tax (GST) are enjoyed by the consumers also and is mulling over adding an anti-profiteering clause.Finance Minister Arun Jaitley said the matter will be discussed so that the prices are not hiked when GST is implemented.
The GST Council will take up the matter if it is brought up before it.
"This will entail detailed audit of financial data of companies and would lead to avoidable disputes. Instead, the government should focus on engaging with industry so that they understand the benefits of input credits and pass on the benefit to consumers," Pratik Jain, partner and leader, indirect tax, PwC India, told ET.
"Currently, what the taxpayers are paying is phenomenally much higher. For almost 60-70% of the commodities on a weighted average, you are paying 27% plus a large number of other small taxes. In some instances, states say it's even higher at 30-32% or more," said Jaitley.
GST will have a three-slab structure with most goods and services at the standard rate in the middle. A lower rate will be imposed on essential items to protect the poor and a higher rate on luxury items.