Through a fictional dialogue between Arjuna and Krishna, this piece explains the government’s circular on revising the Maximum Retail Price (MRP) of unsold pre-packaged goods due to GST rate changes. Manufacturers, packers, and importers can update MRPs until December 31, 2025, by stamping, stickers, or online printing, while ensuring the original price remains visible. The revision must strictly reflect GST-related changes, not arbitrary hikes. The circular also mandates newspaper advertisements and dealer notifications to maintain transparency. Retailers must display revised MRPs properly, and consumers should stay vigilant to ensure fair pricing. The key takeaway: transparency, fairness and compliance are essential for smooth GST-driven price revisions.
Arjuna (Fictional Character): Krishna, I've heard that GST rates on some products have changed, and there's talk about revising the Maximum Retail Price (MRP) on unsold stock. Can you explain what's happening?
Krishna (Fictional Character): Yes Arjuna! So, the Ministry of Consumer Affairs, Food and Public Distribution, through its Department of Consumer Affairs (Weights and Measures Unit) has issued a circular allowing manufacturers, packers, and importers of pre-packaged goods to revise the MRP of unsold stock due to changes in GST. Now, they can revise prices on products that were packed before the GST change but which they haven't sold yet. This can be done until the stock is exhausted, or by 31st December 2025, whichever is earlier.
Arjuna (Fictional Character): Krishna, but how exactly do they go about making these changes? Is there a magic button?
Krishna (Fictional Character): No Arjuna. There's no magic button. The manufacturers, Packers and importers can revise the MRP by either stamping, putting a sticker, or using online printing on the packages. But the key here is that the original MRP must still be visible and not be overwritten. The original price tag must stay intact.
Arjuna (Fictional Character): That's interesting, Krishna. but what if the new price exceeds the tax impact due to the GST change? Can they just slap any number on the price?
Krishna (Fictional Character): No Arjuna, they can't just do that! There are some strict rules and conditions in place.
Revised price should reflect tax change: The difference between the original MRP and the revised price should only be based on the change in GST rates. If the tax increases or decreases, the price change should only reflect that.
Advertisement Required: Manufacturers or packers must publish at least two advertisements in newspapers to inform the public about the revised MRP and also circulate notices to dealers and the Director of Legal Metrology.
Packaging materials: Any unused packaging material printed before the GST revision can still be used until December 31, 2025, or until it runs out, as long as the corrections to the MRP are made through stamping, stickers, or online printing.
Arjuna (Fictional Character): So, what do the manufacturers, retailers, and consumers need to do to stay on top of this?
Krishna (Fictional Character): Yes Arjuna, let's break it down!
For Manufacturers, Packers, and Importers:
1. They must revise the MRP by 31st December 2025, or until stock runs out, whichever is earlier.
2. They can stamp, place a sticker, or use online printing to update the MRP, but the original price should still be visible.
3. The revised price must reflect only the change in GST, no excess charges.
4. Make at least two advertisements in newspapers about the price change and also circulate notices to dealers and the Director of Legal Metrology.
For Retailers:
1. When they see the revised MRPs, they must ensure the new price is displayed properly alongside the old price. They must honor the revised prices, and if they don't, they could face complaints from customers who expect transparency.
For Consumers:
1. Consumers need to watch out! The revised price might look different, but it's important to know that it should only reflect the GST change, not some random hike. For example, if price of any product went from ₹105 to ₹100 the reduction of ₹5 should be for GST component only. They must be aware that the revised price tag could be placed anywhere on the packaging, so don't miss it while shopping!
Arjuna (Fictional Character): Krishna, what lessons should we, as consumers and businesses, take from all this?
Krishna (Fictional Character): Arjuna, you always look for wisdom. Here's what one should learn from this change:
The key lesson here is transparency and fairness in price revisions due to changes in GST rates. For manufacturers, retailers they need to ensure the revised MRP is clearly visible and accurate, and for consumers, they need to be aware of how the GST change affects the prices. A little care, compliance, and communication go a long way in making this process smooth and beneficial for all. All the consumers, retailers and businesses need to be transparent about price changes.
CAclubindia
