GST: Government In No Rush To Set Up Anti-Profiteering Body, Says CBEC Chairman

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The government is not considering setting up an anti-profiteering body under the Goods and Services Tax regime anytime soon and the GST Council will take a final call in the matter.

“There is no timeline as to when this will be set up as the priority is to roll out GST (Goods and Services Tax),” Central Board of Excise and Customs (CBEC) Chairman Vanaja Sarna told BloombergQuint in an interview. The GST Council will decide whether any such body will be set up or this work will be assigned to an existing regulator like the Competition Commission of India, she said.

The Central GST Law includes a provision to pass on the benefits of reduction in tax rates to consumers once the new indirect tax regime is implemented, and is generally referred to as an anti-profiteering measure.

In a separate interaction, another senior official of the CBEC, to be renamed CBIC (Central Board of Indirect Taxes and Customs), told BloombergQuint that determining the fluctuations in the price of an individual commodity will be difficult as it depends on several factors.

A fall in prices of raw materials could be because of other global factors and not necessarily GST, the official said. It will then be difficult to conclude whether the prices fell because of the GST and if the lower prices should be passed on to consumers. It will also increase litigation, making life difficult for manufacturers, especially small and medium-scale industries, the official said.

The government is not considering setting up such an anti-profiteering body anytime soon, the official said requesting anonymity. It is studying the gray areas in a similar regulator established by the Malaysian government before implementing GST there, which he said turned out to be a failure.

Read more at: https://www.bloombergquint.com/gst/2017/05/02/gst-government-in-no-rush-to-set-up-anti-profiteering-body-says-cbic-chairman