Importers of food i.e. unsold inventories of imported chocolate, confectionery and cosmetics, which attracted 28% Integrated Goods & Services Tax (GST) during inbound shipments will now be a retailing tax of 18%. They can now claim refunds on excess GST but also have to submit proofs.
The reduction in GST rates for products imported at a higher rate may have some short-term working capital impact on the importer. However, this can be adjusted for future sales.
While Indian vendors are in the process of manufacturing stocks with revised prices on packaging, importers say they are saddled with inventories because their import cycles extend anywhere between three and six months.
The government has allowed companies to put stickers on unsold stock, printing the new maximum retail prices (MRP) as long as the earlier MRPs are also visible. This facility is available until December 31, 2017, applies to both locally manufactured and imported products.
Source: Times of India