Organised retailers do not expect the Goods and Services Tax (GST) to impact their sales. As GST will be rolled out from July 1, they feel it will lead to better compliance and an organised way of doing things. They do not anticipate any sales disruptions. They are waiting for benefits which will come as and when manufacturers change prices, which in turn they hope to pass on to consumers.
July onwards, large retail companies, including Reliance Retail, Future Group, Trent HyperCity and DMart, among others, are looking at aggressive price reductions. The common objective of all retailers is also that margins should be protected while ensuring that prices remain under check. The Future Group hopes to reduce prices by two to 20 per cent on various consumer products. Future Group also sells a lot of private labels.
Most retailers believe that the new taxation structure is about simplification and ease of doing business. Most large retailers are in talks individually with FMCG companies to ensure that their margins are retained while ensuring lower prices to consumers. They are ensuring that their systems like IT are in place and are also working to educate the value chain.
Most retailers are awaiting more clarity on various issues, including input tax credit and e-way bills.