Mumbai Grahak Panchayat (MGP) has requested the minister of consumer affairs to withdraw relaxations in implementing the revised goods and service tax (GST) rate for maximum retail prices (MRPs) on packaged goods. It has claimed that the relaxations are not in the interest of consumers and will enable manufacturers and retailers to retain outdated higher MRPs and deny consumers the rightful benefit of reduced GST rates.
The department of consumer affairs issued a circular dated September 18, in light of GST reductions, asking manufacturers and traders for voluntary compliance of older stock, no mandatory public advertisement, extended use of old packaging till March 2026, simplified dealer communication replacing broader disclosure and reduced burden on small manufacturers and retailers during GST transition.
However, MGP believes that the circular considerably dilutes the key compliance requirements for manufacturers and traders in revising the MRPs following the recent reduction in GST rates. While it appreciated the intent to ease transitional hardships of the industry and trade, it submitted that the relaxations, particularly the optional nature of MRP sticker revisions, waiver of public advertisement and extended use of old packaging, are definitely not in the interest of consumers. It alleged that these provisions will enable manufacturers and retailers to retain outdated higher MRPs and deny consumers the rightful benefit of reduced GST rates.
In a letter dated to the union consumer affairs minister Prahlad Joshi, it stated that, in the absence of mandatory price revision and public disclosure, there is a high likelihood that consumers will continue to pay inflated prices, despite lower GST rates, retailers may exploit the ambiguity to avoid passing on benefits and market transparency will be compromised, undermining the objectives of the legal metrology (packaged commodities) rules, 2011 and the consumer protection act, 2019.
It reflected that the earlier circular dated September 9 rightly mandated revised MRPs and public notification, ensuring accountability and consumer awareness. It claimed that diluting these safeguards now sends a wrong signal and may erode public trust in the government. Citing the finance minister’s assurance that the entire GST rate cut benefit would be passed on to the consumers, it submitted that the new circular is contrary to the central government's publicly declared intention and also far from convincing.
“It is extremely difficult to believe that any manufacturer could be having printed packaging material with MRP thereon which will last for six months. As such we see no justifying reasons for the department to generously extend this time limit from December 31, 2025, as directed in the September 9 circular, March 31, 2026. Similarly other waivers such as putting revised stickers, public announcements in newspapers and penalty for not passing benefits to consumers, are not arising from genuine practical difficulties of the industry and hence totally unwarranted and unjustified,” read the letter.
It urged the minister to reconsider and withdraw the relaxations announced in the latest circular and added that a clear directive reinstating mandatory MRP revision and public disclosure will go a long way in preventing overcharging the consumer and reinforcing the government's commitment to fair trade practices. It requested the minister’s intervention for wider consumer interest and asked him to act decisively to uphold the rights of consumers and ensure that GST benefits are fully passed on transparently and uniformly to all consumers.
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