Consumer Backlash to GST 2.0 Rate Cuts: Nearly 4,000 Complaints Received by NCH

 

Following the rollout of the GST 2.0 Rate Rationalization on September 22, 2025, the National Consumer Helpline (NCH) has been flooded with nearly 4,000 GST-related calls, with 69% reporting consumer grievances.

The complaints highlight widespread consumer confusion and the government's dual challenge: clarifying misinformation while ensuring that genuine tax benefits are passed on.

Key Findings from NCH Grievances:

The majority of the grievances stem from misunderstandings about which specific commodities had their GST rates reduced.

Grievance Category	Consumer Expectation (Misperception)	Official Clarification by CCPA
Milk Pricing	Consumers complained that prices of fresh milk had not dropped, expecting a reduction after the reform.	Fresh milk is already GST-exempt. The recent reform only extended the exemption to UHT milk. No price drop was mandatory for fresh milk.
Electronic Goods	Consumers complained that the prices of laptops, refrigerators, and washing machines bought online had not decreased.	Most listed goods were already at 18% GST. The rate reduction (from 28% to 18%) specifically applied to items like TVs, monitors, and ACs.
LPG Cylinders	Consumers reported that the prices of domestic LPG cylinders had not fallen.	Domestic LPG remains at 5% GST. Pricing is primarily influenced by global crude oil and subsidies, not the recent tax rationalization.
Petrol Prices	Many consumers lodged complaints demanding lower petrol prices.	Petrol is outside the purview of GST. Consumers' expectations reflect a fundamental misunderstanding of the GST's scope.

Government Response and Action:

The government is actively using these complaints to enforce compliance and clarify confusion.

1. Anti-Profiteering Watch: The Central Consumer Protection Authority (CCPA) is initiating a detailed review of grievances to identify instances where companies failed to pass on the benefit of the reduced GST rates on items where the tax was cut.
2. Escalation: 1,992 GST-related grievances have been forwarded to the Central Board of Indirect Taxes and Customs (CBIC) for appropriate action, indicating a strong focus on compliance monitoring.
3. Industry Consultation: The Department of Consumer Affairs has held consultations with industry bodies (FICCI, CII, etc.) urging them to ensure the benefits of the reduced GST on pre-packaged commodities are immediately reflected in the retail price (MRP).

The NCH, accessible via toll-free number 1915, remains the primary platform for consumers to register grievances, reflecting consumers' active participation in the compliance system.