GST 2.0 – GOVERNMENT’S GIFT
~ Riya Agarwal & Dr. Bhoomika Batra
As India gears up for the festive season, GST 2.0 has shaken up the retail sector, resulting in record-breaking sales while straining supply chains to the limit. The government’s tax revamp has slashed taxes on key consumer goods, making this festive season one of the most dynamic ones in recent times.
From home appliances to entry-level cars, consumers are delighted due to the advantages of lower tax rates. Electronics, homeware, and mid-priced cars have become more affordable. This has led to increased spending at both retail stores and online shopping sites.
Retailers are reporting unmatched traffic, with outstanding responses. Although several sectors are experiencing double-digit growth in sales, significant logistical challenges exist behind these impressive sales figures. The increase in orders has overwhelmed distributors, warehouses, and delivery networks. This has resulted in delays in shipments and stock shortages. Logistic operators feel like they were unprepared for such a steep and sudden increase in demand.
The Luxury Market is losing its Shine, while the Mass Market is booming. The luxury sector is facing increased taxes, reducing its sales and, in turn, profits. Some brands have also considered price hikes. As festive shopping peaks, experts advise consumers to verify actual price reductions and delivery timelines. Buyers should make it a point to cross-check pre- and post-GST pricing rather than relying on advertised discounts, because “A deal isn’t always a deal.”
GST 2.0 has not only transformed India’s sales landscape but also highlighted the underlying limitations in our system. It has emphasized the importance of efficient supply chain planning to better serve the country’s highly aspirational and rapidly evolving consumer market.
