Traders in Kerala have expressed concern that the recent GST exemptions may be benefiting large corporates at the expense of small and medium trading establishments. The State President of Kerala Vyapari Vyavasayi Ekopana Samithi and National Secretary of the Confederation of All India Traders (CAIT), Manoj, highlighted that within 10 days of the revised tax structure, several large companies reportedly raised prices on their products, triggering worries about profiteering.
"The GST exemptions seem to be favouring large corporates for profit hunting. There is a need to curb this at the production level itself," Manoj said.
Traders face confusion over the list of goods with reduced GST. While some products have seen their tax rate fall from 18% to 5%, others remain taxed at 18%, and combination products continue to attract higher rates. According to Manoj, the Central Government has given over 800 companies until October 20 to clarify GST applicability on various items.
"To correctly understand which products are tax-reduced, traders have to rely on new purchase bills from companies. Any misstep in charging GST - either undercharging or overcharging - could lead to significant costs for traders," he added.
Another challenge for trading establishments is software readiness. Most supermarkets and retail chains use inventory software from a handful of vendors, and the delay in software updates to categorize GST-exempt items across thousands of SKUs is creating operational difficulties. Manoj emphasized that the limited time provided for implementing the new GST structure has further complicated matters for traders.
The concerns raised by Kerala traders underline the need for clear guidelines, adequate transition time, and support for small and medium businesses to adapt to tax reforms, ensuring that GST changes do not disproportionately benefit large corporations.
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