Cabinet nod to setting National Anti-Profiteering Authority to ensure GST benefits to consumers

Cabinet nod to setting National Anti-Profiteering Authority to ensure GST benefits to consumers

Cabinet nod to setting National Anti-Profiteering Authority to ensure GST benefits to consumers

The Union Cabinet on Thursday approved establishing the National Anti-profiteering Authority (NAA) under the Goods and Service Tax (GST) to ensure that benefit of the reduction in prices under the uniform tax regime reaches the consumers. The Cabinet consented to creating positions of Chairman and technical members of the authority which would lead to immediate establishment of the apex body. One of the key mandates of GST is to pass on the benefits of price cuts, on account of lower tax rates, to its customers.

While Finance Ministry continuously urges states and traders to conform to this norm, NAA will be able to ensure this on a more proactive manner. The NAA is aimed at reassuring consumers that Government is fully committed to take all possible steps to ensure the benefits of implementation of GST in terms of lower prices of the goods and services reach them, a government statement said.

“The ‘anti-profiteering’ measures enshrined in the GST law provide an institutional mechanism to ensure that the full benefits of input tax credits and reduced GST rates on supply of goods or services flow to the consumers. This institutional framework comprises the NAA, a Standing Committee, Screening Committees in every State and the Directorate General of Safeguards in the Central Board of Excise & Customs (CBEC),” the statement further added.

As per the Cabinet decision, the NAA will be headed by a senior Secretary-level official of the Central government, with four technical members from either the Centre or the states. This is the second major GST-related decision taken by the government within a week. On November 10, the GST Council relocated 178 items from the higher 28 per cent tax slab to lower tax slabs. This was the highest number of items getting a tax rate reduction in one go since GST was rolled out.

“Affected consumers who feel the benefit of commensurate reduction in prices is not being passed on when they purchase any goods or services may apply for relief to the Screening Committee in the particular State. However, in case the incident of profiteering relates to an item of mass impact with ‘All India’ ramification, the application may be directly made to the Standing Committee. After forming a prima facie view that there is an element of profiteering, the Standing Committee shall refer the matter for detailed investigation to the Director General of Safeguards, CBEC, which shall report its findings to the NAA,” the statement said on the working of the NAA.

It further said, “In the event the NAA confirms there is a necessity to apply anti-profiteering measures, it has the authority to order the supplier / business concerned to reduce its prices or return the undue benefit availed by it along with interest to the recipient of the goods or services. If the undue benefit cannot be passed on to the recipient, it can be ordered to be deposited in the Consumer Welfare Fund. In extreme cases, the NAA can impose a penalty on the defaulting business entity and even order the cancellation of its registration under GST.”

Menawhile, Finance Minister Arun Jaitley assured that Indian economy is already on the road to recovery after being shaken by the recent economic policies, even as Finance Ministry is still trying to shape Goods and Services Tax into a widely agreeable tax regime. The economic parameters, he said, are showing signs of normalcy.

Jaitley was elaborating on economic reforms seen in India during the past few years at the Morgan Stanley annual conference. He agreed that there was a “temporary blip” in the economy due to structural reforms, but positive signs can be seen now.

“Our basic parameters are quite stable. And we grew between 7-8 per cent over the last three years,” he said.

Finance Minister said three key structural reforms – Aadhaar, Demonetisation and GST – have enhanced transparency and helped in transition from cash to less cash economy.

Jaitley made this comment before a gathering of investors while highlighting various achievements like ease of doing business ranking by the World Bank.

“The three key structural reforms implemented by the present government in recent years viz Aadhaar, Demonetisation and GST have brought transparency and efficiency in governance and helped in transition from cash to less cash economy and from informal to formal economy,” Jaitley said in address to investors.

To provide further impetus to the economy, the present government has implemented a slew of economic reforms one after the other, including the roll out of the game changing tax reform Goods and Services Tax (GST) from July 1, 2017; introduction of Insolvency and Bankruptcy Code (IBC) and the re-capitalisation package for the banks, he said.

Recapitalisation will help to redress the twin balance sheet problem and revive private investment, he added.

The finance minister also spoke about the major initiatives undertaken by the present government, including crackdown against black money through demonetisation and other follow-up measures, and major changes in the Foreign Direct Investment (FDI) Policy regime with an aim to make it more liberal and investor friendly.

Source by:-businesstoday