The 56th GST Council Meeting, held on 3rd September 2025, has brought major reforms in the Goods and Services Tax (GST) system. The key recommendations, which are being implemented from 22nd September 2025, focus on reducing GST rates or providing exemptions on several consumer goods and products of mass consumption.

While these reforms are highly beneficial for consumers, they also create challenges for businesses holding unsold stock manufactured, packed, or imported before 22nd September 2025. To address this, the Central Government, through the Department of Consumer Affairs (Legal Metrology Division, CAFPD), has issued a notification (F. No. I-10/14/2020-W&M dated 09.09.2025) allowing businesses to revise the Maximum Retail Price (MRP) of such unsold stock.

This measure ensures a smooth transition of GST rate changes and avoids wastage of packaging material, stock, and resources.

Why MRP Revision Was Needed

Whenever tax rates are revised under GST:

• If GST rate increases, the MRP must increase accordingly.
• If GST rate decreases, the MRP must decrease so that consumers benefit from the rate cut.

Without such permission, businesses would face huge losses because they would be unable to sell unsold stock with old MRPs. Similarly, consumers could suffer if businesses overcharge. Hence, the government has allowed revised MRP declaration on existing stock.

What the Government Permitted

From 22nd September 2025, businesses (manufacturers, packers, or importers of pre-packaged commodities) can:

1. Revise MRP of unsold stock manufactured/packed/imported before 22.09.2025.
2. Show the revised MRP in addition to the original MRP (not overwrite it).
3. Use stickers, stamping, re-tagging, or online printing to declare revised MRP.
4. Continue using old packing materials/wrappers till 31st December 2025 or until the stock is exhausted (whichever is earlier).

Key Conditions for Revising MRP

Businesses must follow certain rules while revising MRPs:

1. Original MRP must remain visible – Revised price cannot overwrite the printed MRP.
2. Price difference must match the tax change –
   • If GST rate increases, the increase in MRP cannot be more than the actual tax increase.
   • If GST rate decreases, the reduction in MRP must reflect the reduced tax.
3. Consumer Awareness – Businesses must:
   • Publish at least two advertisements in newspapers.
   • Circulate notices to dealers, distributors, and Legal Metrology authorities.
4. Packaging material – Old wrappers or packaging can be used till 31st December 2025, with corrections made to MRP through stamping/stickers.

Business Obligations

Businesses must gear up for the following:

• ERP and Software Updates – Update ERP, billing, and inventory systems with new GST rates and MRPs.
• Transparency – Display both old and revised MRPs to avoid confusion and build consumer trust.
• Logistics & Operations – Manage distribution, advertisement, and point-of-sale adjustments quickly before festive season sales.
• Compliance – Inform authorities and ensure revisions match the GST changes.

Government’s Objective

The government’s decision aims to:

• Prevent profiteering by ensuring businesses pass on GST benefits to consumers.
• Avoid wastage of unsold goods and packaging materials.
• Support ease of doing business by providing a practical transition plan.
• Ensure consumer protection by making prices transparent.
• Facilitate festive season sales by avoiding market disruptions.

Impact on Businesses and Consumers

• For Businesses:
  • Provides relief by avoiding losses on unsold stock.
  • Reduces operational challenges during GST transitions.
  • Ensures better compliance and smooth sales operations.
• For Consumers:
  • Guarantees that reduced GST benefits reach them.
  • Builds confidence through visible old and new MRPs.
  • Prevents unfair overcharging.

Conclusion

The permission to revise MRPs on unsold stock due to GST reforms effective from 22nd September 2025 is a significant relief measure for businesses and a consumer-friendly initiative. It ensures smooth implementation of GST rate cuts, prevents misuse, avoids wastage of goods and packaging, and guarantees transparency in the marketplace.

This timely step will not only help businesses manage stock efficiently during the festive season but also strengthen consumer trust in GST reforms as a tool for making essential goods more affordable.