Published on : Jun 15, 2017
As the countdown for Goods and Services Tax (GST) rollout enters the final stage, discount on electronic appliances, mobile accessories, apparel, and footwear is picking pace. Ecommerce platforms and brick and mortar stores alike, are flooded with offers as retailers get wary of products stocked before 1st July, 2017, on which net tax is likely to scale higher, alongside ancillary concerns over paperwork that existing stock would require.
Impending GST Compels Enterprises to Offer Discount on Stocked Products
It is important to note here, while apparels are available at as high as 50% discount, electronic companies are offering products at a sale price of nearly 10 to 40 per cent. This flash sale by retailers is aimed at clearing their slow moving inventory. Against this backdrop, Paytm Mall announced a clearance sale between 13th June and 15th June, in which over 500 brands were sold by nearly 6000 retailers.
Meanwhile, the Bajaj Auto announced a price-cut of its motorcycles by nearly Rs. 4,500. Taxes on motorcycles in India are likely to reduce post GST implementation from July 1. The company has further revealed its plans to offer reduced prices to customers post GST, with effect from 14th June, 2017. Wholesalers and retailers, who have paid their VAT, are currently eligible for 100 percent credit on the value added tax paid upon presentation of receipts for stocked goods. Following 1st July, stockists will be benefit from 40% deemed credit on the payment of excise duty made at the factory gates. But this will happen if only the product in question is eligible for less than 18% GST and attracts 60% credit on products eligible for 18% GST.