{
  "id": 8781596,
  "title": "One year on, commodity prices eat into gains from GST rate rejig",
  "url": "https://urgent.news/2026/09/20/one-year-on-commodity-prices-eat-into-gains-from-gst-rate-rejig",
  "topic": "business",
  "section": "Business",
  "published": "2026-09-20T21:55:24.000Z",
  "source": {
    "name": "Times of India",
    "slug": "times-of-india",
    "url": "https://timesofindia.indiatimes.com/business/india-business/one-year-on-commodity-prices-eat-into-gains-from-gst-rate-rejig/articleshow/134375353.cms"
  },
  "original_language": "en",
  "account": "One year after India's GST reform, higher commodity costs have significantly reduced the benefits from the reduced tax rates, according to recent reports. Auto sales surged after tax cuts, with automobile retail sales hitting 29 million units in eight months, up 20% from the previous year. Passenger vehicle registrations increased 22%, two-wheelers rose 20%, commercial vehicles grew 19%, and tractors jumped 23%. ICRA's Jitin Makkar attributed this to a boost in consumption sentiment, as seen in manufacturer dispatches over the past six months. However, the advantage has been diminished as vehicle prices, such as the Maruti Alto K10 STD and Mahindra Scorpio-N Z2, have climbed due to higher raw-material, energy, and logistics costs. In fast-moving consumer goods, initial price cuts of around 10% due to reduced GST have since been reversed, with companies raising prices by 6-7% to offset other expenses. Consumers are still better off by 2-3%, but companies may need another price hike around Diwali if inflation persists. Nestle India noted the GST reform provided an affordability boost, but analyst Ronak Shah said it offered more of a cushion against inflation than a surge in demand for FMCG companies. Premium and discretionary products saw some demand increase, but subsequent mid-to-high-single-digit price hikes eroded the gains. Apparel prices were also affected when GST on clothing above Rs 2,500 rose from 12% to 18%, impacting festive and occasion wear. Mid-market hotels also faced challenges, moving from a 12% GST with input-tax credit to 5% without it, squeezing margins as key inputs remained taxed at higher rates.",
  "summary": null,
  "key_points": [],
  "editors_take": null,
  "illustration": null,
  "coverage": {
    "outlets": 1,
    "also_reported_by": []
  },
  "ai_generated": true,
  "disclaimer": "Summaries, key points and the editor’s take are written by software from other outlets’ reporting and may contain errors — always check the linked original."
}