Profiteering by Industries post GST implementation
There have been number of posts alleging profiteering by the industry post implementation of GST. I had also initially brought out a case where the restaurant had adopted to profiteering on the pretext of GST whereas the GST should have reduced the prices by around 10%. on the contrary, the restaurant had increased the prices by about 40 to 50% just immediately after GST.
It is also a fact that the cases of profiteering may not get established as basically there is no law w.r.t the profit margin that can be capped and more so it is very difficult to track the increase in prices specially which are not of daily use item.
A newspaper report has brought out a news that not the income department would look into the issue of profiteering by the industry. On the one side it feels that the industry is adapting to profiteering and is not passing on the benefit of price reduction. In my view this also seems to be making mockery of the public. First of all, is there any law which stipulates the %age of the profit except essential commodities or the amount on business expenditure that any business house is allowed to incur or increase the traders commission specially when its own house is not in order w.r.t petroleum products. Secondly under which law Income Tax Department can prosecute the business houses whose profits have increased after implementation of GST. In my view the Income Tax Department may be concerned only whether the assessee has paid the taxes correctly or not. GST scheme itself is complicated beyond the understanding of ordinary consumers like me where even the CAs are finding it difficult on input tax credit, output tax, adjustments etc. Whether the Government has doubt that the National Anti-profiteering Authority would be able to discharge its statutory function. Members may kindly provide views for better understanding or is such a move any eye-wash specially when the Election 2019 are very near. more
It is also a fact that the cases of profiteering may not get established as basically there is no law w.r.t the profit margin that can be capped and more so it is very difficult to track the increase in prices specially which are not of daily use item.
A newspaper report has brought out a news that not the income department would look into the issue of profiteering by the industry. On the one side it feels that the industry is adapting to profiteering and is not passing on the benefit of price reduction. In my view this also seems to be making mockery of the public. First of all, is there any law which stipulates the %age of the profit except essential commodities or the amount on business expenditure that any business house is allowed to incur or increase the traders commission specially when its own house is not in order w.r.t petroleum products. Secondly under which law Income Tax Department can prosecute the business houses whose profits have increased after implementation of GST. In my view the Income Tax Department may be concerned only whether the assessee has paid the taxes correctly or not. GST scheme itself is complicated beyond the understanding of ordinary consumers like me where even the CAs are finding it difficult on input tax credit, output tax, adjustments etc. Whether the Government has doubt that the National Anti-profiteering Authority would be able to discharge its statutory function. Members may kindly provide views for better understanding or is such a move any eye-wash specially when the Election 2019 are very near. more
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You do something, you are damned; you don't do anything. you are, of course, seriously damned. more
Oct 23
@Satyendra Singh Ji, Sir, neither I am a pro-business nor I am saying to call any business house honest one. What I am stating rather seeking details as to under which Act or rule Govt can cap the profit margin for normal commodities, general products. If it cannot then why Anti-profiteering Authority or why investigation by Income Tax Department. Let Govt enact the provisions first and then act else all tax payers money being wasted. If there are no rules to govern profitability of any business house, just praising the Govt would not bring the results if desired and at the same time it should not be steps towards eye-wash more
Oct 23
Why are you pro business? Govt has every right to audit the costing on any company and put a cap on maximum price to be charged. At least Govt can bar price increase both before the budget and after budget for a limited time otherwise, what is the benefit to public from tax reductions announced. If a rickshawala asks you for an extra fare you call him dishonest butbusiness houses can do as they like.Is it justified? more
Oct 22
Sellers would not incur loss if they sell at reduced price due to implementation of GST but they increased their prices just to make sure the buyer does not get ant benefit on account of reduced GST. Our business class is nothing sort of sadist. Mr Virmani must understand that profit margin of seller is same even if he honestly applies reduced GST. Our Govt is impotent and full of corrupt officials. In my opinion big companies should be penaliized heavily to set up an example to others and each such case should be given wide publicity. more
Oct 22
Sir, under which rules the Govt can penalised the companies for higher profit margin. Is there any cap on the percentage of the profit. more
Oct 22
