GST 2.0 reforms set to create new Diwali shopping records: Economists
Economists on Tuesday said the GST 2.0 reforms are set to create new Diwali shopping records in the country as purchasing power has considerably gone up while inflation has come down to a historic low.
The reduction in GST has put more money in people’s hands and when purchasing power increases, inflation automatically decreases.
“The reduction in retail prices has had the greatest impact on the lower and middle classes. Those who used to be able to buy one item, say for Rs 100, are now able to buy multiple items,” Harvansh Chawla, Chairman, BRICS Chamber of Commerce and Industry, told IANS.
According to him, this is going to be a “historic Diwali”.
“Sales that will take place this Diwali will be unprecedented and traders will be immensely benefitted,” he added.
According to economist Dr Manoranjan Sharma, India’s inflation rate based on the Consumer Price Index (CPI) declined to an over 8-year low of 1.54 per cent in September this year, compared to the same month of the previous year, as prices of food items and fuels turned cheaper during the month.
Moreover, India’s annual rate of inflation based on the Wholesale Price Index (WPI) eased to 0.13 per cent in September from 0.52 per cent in August.
September GST collections also hit Rs 1.89 lakh crore, showing 9.1 per cent YoY growth, reflecting recent rate cuts.
“Today, the common man has more money left with him, which we call disposable income which has provided relief to millions of people,” Dr Sharma told IANS.
“This Diwali, you may see a greater increase in shopping owing to GST cuts. The festive atmosphere will be more pleasant than before as people will now be able to shop more, and traders will also benefit in the due course,” he added.
GST reforms have led to lower prices, smoother credit flow, resolution of tax inversion issues and reduced disputes, ultimately cutting costs for producers and consumers alike.
