HSBC Sees FMCG's GST Cut-Led Growth Losing Steam As El Nino Impact, Commodity Inflation Remain Risks

On the flipside, the brokerage assessed that a pullback in commodity prices could mean big gains for players like Britannia and GCPL, without structurally altering growth or margin profiles.

Nestle has delivered superior growth over the last four quarters following GST 2.0, and it expects growth momentum to moderate on account of a high base, rising food inflation, and limited room for Ebitda margin expansion, which is already at 24%, highlights the brokerage.

Weak monsoon, costlier inputs and a high base from last year’s GST cuts worry investors, but Goldman Sachs says Marico and Tata Consumer face the lowest risk of an earnings slowdown

Although gold prices may be high, you are likely to receive lesser value for your jewellery as making charges, GST, etc are not refunded.

Robust direct tax and GST collections, along with stronger customs receipts, are expected to help the Centre meet its FY27 net tax revenue target of Rs 28.7 lakh crore, cushioning a potential shortfall in excise duty collections.

Centre had proposed to the GST Council to allow only tax officers at the source state to stop a vehicle for inspection. But states wanted destination state officers' right to inspect as well.

The GST Council, chaired by Union Finance Minister Nirmala Sitharaman and comprising state counterparts, had in September 2024 recommended rolling out a pilot for B2C e-invoicing.

The CBIC is reviewing blocked input tax credit claims, refund processes and faceless assessments as it seeks to simplify GST compliance and improve predictability for businesses.

The decline comes even as the GST base continues to expand. Taxable supply has risen 25.8%, while GST revenue grew 11% in FY2026-27.

From faster refunds to lower penalties, the government has proposed a set of GST changes, which will potentially ease the burden on small businesses.

The GST Council recommended that prosecution threshold will be raised from Rs 1 crore to Rs 5 crore.

Registration and refunds are already increasingly system-driven, and the government now intends to extend this approach to tax administration and assessment.

The council cut the GST refund acknowledgement timeline to 10 days from 15 days.

A taxpayer who files late, makes an error or delays payment will face recovery, interest and a proportionate penalty, but nothing beyond that.