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Showing posts from August 20, 2018

GST Cut Gives a Boost to Consumption Stocks

BETTER DAYS Lower prices ahead of the festive season will allow companies to up volumes The government’s decision to slash rates of GST on a wide range of consumer goods is being cheered by analysts. Tax rates were cut from 28% to 18% across items, including consumer durables such as washing machines, television sets, vacuum cleaners and refrigerators, apart from sharp cuts in smaller items such as footwear, paints, leather products and textiles. This is expected to spur demand and give a fillip to the consumption theme. Of the 50 items that are under the highest tax slab of 28%, 19 will see a cut in taxes. Rates on select items from other slabs of 18% and 12% have also been lowered. Analysts say this cut will be passed on to consumers through cut in prices in the range of 8-12%. With the festive season round the corner, lower prices of more than 50 items will allow companies to boost volumes, giving a push to the discretionary consumption theme that has been a prominent play in the mar…