Government Eases Sticker Regulations, Providing Relief for Companies
In a significant move aimed at easing the transition to the new Goods and Services Tax (GST) regime, the Indian government has announced that companies will no longer be required to re-sticker unsold stock manufactured before September 22. This decision, welcomed by the fast-moving consumer goods (FMCG) sector, is expected to alleviate logistical challenges associated with compliance. The government has also clarified that displaying revised maximum retail prices (MRPs) on unsold products is now optional, allowing businesses to focus on smoother operations during this transition.
Relaxation of Re-Stickering Requirements
The government’s recent announcement has made it clear that re-sticker requirements for unsold products will be voluntary for companies. This change comes in response to concerns raised by the FMCG industry, which highlighted the logistical difficulties of re-sticker processes. Mayank Shah, Vice President at Parle Products, noted that the challenge was particularly significant for products like biscuits, which are distributed through approximately 10 million retailers. The easing of these regulations is expected to facilitate a smoother transition to the new GST framework, allowing companies to manage their existing stock more effectively.
Optional Display of Revised MRPs
In addition to the relaxed re-stickering norms, the government has stated that companies are not mandated to display revised MRPs on unsold products or unused packaging materials that already feature a pre-printed MRP. The Consumer Affairs Ministry confirmed that while manufacturers and importers may voluntarily declare revised prices, it is not a requirement. This flexibility is anticipated to help businesses manage their inventory without the added pressure of immediate price adjustments, thereby supporting a more gradual adaptation to the new GST rates.
Communication and Compliance Measures
Despite the relaxation of certain requirements, the government has instructed companies to take proactive steps to inform dealers, retailers, and consumers about the revised GST rates. Companies are expected to communicate these changes through various channels and send circulars to trade partners, ensuring that all stakeholders are aware of the new pricing structures. This directive aims to maintain transparency in the market and ensure that consumers benefit from the revised GST rates.
Transition Timeline and Production Adjustments
FMCG companies have already begun adjusting their production to align with the new MRPs, with significant price reductions anticipated for larger product packs. The government has clarified that businesses can continue using existing packaging materials with pre-printed prices until March 31, 2026, or until their stock is depleted. B. Sumant, Executive Director at ITC, emphasized the importance of informing trade partners about these price revisions to ensure that the benefits of the new GST rates reach consumers effectively. This coordinated effort is expected to enhance consumer awareness and facilitate a smoother transition for all parties involved.
Observer Voice is the one stop site for National, International news, Sports, Editor’s Choice, Art/culture contents, Quotes and much more. We also cover historical contents. Historical contents includes World History, Indian History, and what happened today. The website also covers Entertainment across the India and World.
Follow Us on Twitter, Instagram, Facebook, & LinkedIn
