Most appliances and durable makers have increased their prices in the new tax regime under GST, so from now people have to spend more money on the purchase of home appliances. Durable makers would also go for another hike before the festive seasons as the industry is considering a price revision based on input credit, when their existing stock of raw materials and components would replenish.
“For our sector, the net tax would go up. The current tax rate is around 25-27% and would go to 28%. Therefore, immediately the consumer price, which is market operating price, would go up if brand and dealers want to retain the same margin,” said Godrej Appliances business head and executive vice-president Kamal Nandi.
Although trade partners and dealers have exhausted their stocks by showering discounts up to 50%, makers still have finished and raw materials lying at warehouses and would take two-three months to avail the tax credit and bring it at pre-GST level.
“Once we start getting input credit from the freshly purchased raw material, which would happen down the line in two months, then we would have price at the same level as pre GST days,” Singh said.
Companies are getting their price list reviewed and from Monday onwards, dealers would start restocking based on GST prices.
“By Monday or Tuesday we expect price list of all brands to be out and then business would start. Our trade partners have already liquidated their stocks and would start buying,” said Nandi.
However, company as Panasonic would take a decision in this regard next week only.
“It would be not from tomorrow, hopefully we will review the need by early next week,” said Panasonic India Director Sales and Service Ajay Seth.