Delhi/Hyderabad, Sept 7 (Maxim News): The sweeping GST rate cuts announced by the government will give a strong push to India’s consumption story, according to a report.
In its latest report, the global financial services firm Bernstein has painted an optimistic picture for sectors like footwear, quick-service restaurants (QSRs), FMCG, and grocery retail.
According to Bernstein, the biggest surprise was the sharp cut in GST on personal care and home care items such as soaps, shampoos, hair oil, powders, and toothpaste.
The tax on these products has been reduced from 12–18 per cent to just 5 per cent. The report said this move will immediately help FMCG companies as they will retain a larger share of the consumer’s spending.
In the medium term, this could lead to higher demand, either through bigger product packs or because consumers will have more money to spend on other items.
Grocery retailers like DMart, Vishal Mega Mart, and Star (part of Trent), along with quick-commerce companies, are expected to gain significantly from these changes.
In the apparel and footwear segment, the GST rate has also been revised. Earlier, apparel priced below Rs 1,000 attracted 5 per cent GST and those above Rs 1,000 were taxed at 12 per cent.
Footwear below Rs 1,000 faced 12 per cent GST while those above Rs 1,000 had 18 per cent. Now, apparel and footwear priced between Rs 1,000 and Rs 2,500 will be taxed at only 5 per cent.
For apparel priced above Rs 2,500, the GST has been raised to 18 per cent from the earlier 12 per cent, while footwear above Rs 2,500 continues at 18 per cent.
Bernstein said this is a positive change for companies like Trent, which earns about 30 per cent of its revenues from products priced above Rs 1,000.
Aditya Birla Lifestyle Brands Limited and ABFRL will also benefit as many of their products fall in this price range.
Footwear retailers like Liberty, Campus, and Metro will also see an impact due to the new GST structure.
Quick-service restaurants are another big winner from the rate cuts. The GST on key inputs such as cheese, butter, ghee, margarine, sauces, and packaging materials has been reduced.
Since QSRs do not get input tax credit, all GST on their inputs directly adds to their costs. Any reduction, therefore, improves their margins immediately. (Maxim News)
Next Story:
Over 100 Years-Old Temple Demolished For Madrasa In Pakistan
Islamabad/Internet/Hyderabad, Sept 1 (Maxim News): A 100-year-old Hindu temple in Pakistan’s eastern Punjab province has been demolished, a report said last month, but it is being said that the temple was demolished to make way for a nearby madrasa. Locals, minority groups and political parties are demanding the reconstruction of the 125-year-old temple. They have…
Misuse Of Elderly Woman Adhar And Pan Details: GST Evasion Of Rs. 2.53 Crore With Fake Company
Chennai/Hyderabad, Sept 1 (Maxim News): A 71-year-old woman from Tamil Nadu misused her Aadhaar and PAN card details. She used those cards to register a fake GST (GST Fraud) and evaded tax of about 2.53 crores. Her bank account was seized in this incident. 71-year-old Lakshmi lives in Indira Nagar in Uthangarai Municipality of Krishnagiri…
Man Injured After Being Hit By A Car Dies After Being Hit By Another Car
Hyderabad, Sept 1 (Maxim News): A man named Nandulal was walking on the main road leading from ORR Rotary towards Khajaguda village. He was hit by an Innova car. Nandulal, who was seriously injured, was being taken to the hospital by a student named Zaid Shah Qadri. Another Mahindra car came and hit them. Nandulal…
All Wars Should Be Resolved Through Dialogue, Not On Battlefield: PM Modi At SCO Summit
Bishkek/Internet/Hyderabad, Sept 1 (Maxim News): Prime Minister Narendra Modi on Tuesday reiterated India’s stance that all conflicts should be resolved through dialogue and diplomacy, and not through war. Here To Join Us On WhatsApp Addressing the 26th Meeting of the Council of Heads of State of the Shanghai Cooperation Organisation (SCO) in Kyrgyzstan’s Bishkek on…
Telangana Cabinet Expansion: Speaker Eyes Ministerial Post
Hyderabad, Sept. 1 (Maxim News): Telangana politics has entered a fresh phase of suspense amid growing speculation over a possible Cabinet expansion in September. Here To Join Us On WhatsApp The latest signals from TPCC president Mahesh Kumar Goud have increased activity among Congress leaders seeking ministerial berths. Mahesh Kumar Goud indicated that clarity on…
Now you can get the latest stories from Indtoday on Telegram every day. Click the link to subscribe. Click to follow Indtoday’s Facebook page, Twitter, and Instagram. For all the latest Hyderabad News updates
