Anti-Profiteering Provisions under the GST Law

You must have heard that the GST Council in its 23rd meeting proposed a tax rate reduction from the higher slab of 28% on approximately 178 items, but most of the service providers or suppliers instead of passing on the benefit of tax rate reduction in the form of price reduction, have maintained their prices same as they were before the reduction in tax rate and increased their profits. For example: Initially, when GST was introduced the tax rate on restaurants was increased to 18%, hence the restaurants increased their menu prices and subsequently when the rate was reduced to 5% (Without input tax credit) most of the restaurants did not reduce their prices, enjoying the reduction in tax rate as higher profit, which is why the benefit of tax rate reduction was not passed on to the consumers. But now you have an option to file a complaint against such service provider or supplier under the anti-profiteering provisions of the GST Law.  

In view of the same, an ‘Anti-Profiteering Authority’ under the Goods and Service Tax Law has been set-up, to make it certain that the benefit of lower tax rates is passed on to the consumers. Also, the Government has recently notified the Anti-Profiteering Rules, 2017 under the powers conferred on it under Sections of 164 and 171 of the Central Goods and Service Tax Act, 2017 and ‘Anti-Profiteering Complaint Form’ [APAF-1] for the benefit of consumers who want to lodge complaint against the suppliers and service providers for not passing on the benefits of reduced tax rates under GST regime. The anti-profiteering rules are released by the GST council and committee is formed for the supervision of illegal profit of business units after the lower GST rates were made applicable to them.

Any person including the GST authorities can file a formal complaint in the prescribed form i.e. APAF-1, in case a supplier is making illegal profit as per the Anti-profiteering laws. The complaint shall be filed in form APAF-1 before standing committee or state level screening committee along with self attested copies of all the documentary evidences like identity proof, invoice, price list, etc. The copy of form APAF-1 can be downloaded from the website of GST Council. The updated copy of the the form as on this date (11-01-2018) can also be downloaded from the following link:

Download Form APAF-1

Article by Abhinav Chhabra ( Linkedin Profile )

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