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Procter & Gamble fined Rs 241 crore for increasing prices to negate GST reduction

According to NAA, Procter & Gamble (P&G) and Gillette India increased the base prices of 1,383 goods to negate the GST reduction.

November 26, 2020 / 09:53 AM IST

National Anti-profiteering Authority (NAA) has found that Procter & Gamble (P&G) and Gillette India allegedly profiteered over Rs 241 crore by not passing the GST reduction benefits to customers.

In an order issued on November 25, the anti-profiteering watchdog said that the P&G Home Products, P&G Hygiene and Health Care, and Gillette India did not pass on the tax benefit of Rs 181.51 crore, Rs 2 crore and Rs 57.99 crore, respectively.

According to NAA, the companies increased the base prices of 1,383 goods to negate the GST reduction. It asked the companies to reduce the price of the products and deposit the profiteered amount to the central and state consumer welfare fund, along with an interest.

The profiteered amount has to be deposited within three months from the date of passing of the order.

P&G will review the order and assess all possible legal options, a spokesperson said.

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"As a responsible corporate, P&G has entirely passed on the net commensurate benefit under GST to the recipients. In addition, we communicated the same via advertising in mass media to help increase awareness with the consumers, shoppers and retailers. Also, along with the industry, we have been consistently requesting the authorities for a clear set of rules and regulations to eliminate ambiguity and complexity in this area," the company said, as quoted by LiveMint.

Earlier in November, Starbucks was fined Rs 1.04 crore for not passing goods and services tax (GST) cut benefits to customers. The probe was conducted on a complaint filed by a consumer alleging that the company did not reduce the prices of food items after the GST rate on restaurant services was reduced from 18 percent to 5 percent.
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