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Consumers can look forward to splurging on white goods and domestic electrical appliances this festival season. In a much-awaited relief to the consumer durables industry, the GST Council has slashed rates on washing machines, refrigerators and smaller sized TV (upto 68 cm) beside other domestic electrical appliances to 18 per cent
While companies are still working out their new pricing structure, sources said the industry is expected to reduce prices of these products by 7.5-8 per cent.
Kamal Nandi, Business Head & EVP, Godrej Appliances, said, “The consumer durables industry had been witnessing single digit growth for the past seven quarters. We believe this much-needed reduction in GST rates will give a big boost to demand and will help the industry to get back to double digit growth rates.”
Due to an erratic summer, for instance, growth in sales of cooling products such as ACs was lower than expected in the first half of this year.
Manish Sharma, President, CEAMA (Consumer Electronics and Appliances Manufacturers Association), said, “This move by the government has come at a time when we are just about to prepare ourselves for the upcoming festival season. This will prove to be a catalyst for the industry as it looks to reinvigorate its growth this fiscal and in the years ahead.”
However, the Council’s move to reduce GST slab on television sets of up to 27 inches to 18 per cent is expected to provide a bigger boost to domestic LED TV makers as international players have largely been focusing on bigger sizes.
Nidhi Markanday, Director, Intex Technologies, added, “We have a strong presence in the 22-inch and 24-inch TV segment. We believe this will benefit consumers in Tier-3 and Tier-4 towns to a great extent and make the televisions more affordable for them.”
Several players also said that with more and more consumers now opting for bigger sizes, TV sets of up to 43 inches should have been kept in the 18 per cent tax slab.
Eric Braganza, President, Haier Appliances India, added, “We expect to see good sales for washing machines for the rest of the year and good business for refrigerators next year.”
The industry had been urging the government to reduce GST rates on white goods for the past one and half year. Sunil D’ Souza, Managing Director ,Whirlpool India, said, “By rationalising the rates on basic appliances like refrigerators and washers, which today are essentials and not luxuries for the Indian consumer, the government is now taking the benefits of GST implementation down to improving the lives of the Indian consumer.”
Electrical appliances
Domestic electrical appliances such as food grinders and mixers, food or vegetable juicers, shavers, hair dryer and storage water heaters among others have also been now put in the 18 per cent tax slab.
Saurabh Goel, President, Electrical Consumer Durables, Havells India, said: “Bringing these goods in the 18 per cent category will give a boost to the consumer sentiment and encourage them to buy these goods through the formal channels thus benefitting the national economy.”
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