The GST Council’s 56th meeting in September 2025 delivered relief by cutting tax rates on several essential and consumer goods, effective 22 September 2025. This was intended to reduce prices, boost affordability, and promote higher consumption.
But what happens to products already in circulation with old MRPs printed before the tax cut? To prevent disruption, the Department of Consumer Affairs issued relaxations under the Legal Metrology (Packaged Commodities) Rules, 2011 (LM Rules), allowing businesses to continue using old packaging and re-label voluntarily.
For consumers, this raises an important concern: how do you know the actual price of goods after the GST cut?
Revised MRP Rules After GST Cut 2025
The government introduced clear relaxations to strike a balance between compliance for businesses and transparency for consumers.
Key Relaxations
- Voluntary Relabelling: Manufacturers and importers may declare revised MRPs by affixing stickers, stamping, or online printing, but it is not mandatory.
- Original MRP Visibility: The old MRP must remain visible and cannot be overwritten.
- Tax-Only Adjustments: Revised MRPs must strictly reflect GST changes, no arbitrary markups are permitted.
- Extended Packaging Use: Old packaging with pre-GST MRPs can be used until 31 March 2026 or until stock is exhausted.
- Simplified Communication: Companies need not publish newspaper ads; instead, they must circulate notices to dealers and retailers and notify metrology authorities.
Healthcare Exemption
For pharmaceuticals and medical devices, re-labelling is waived. Instead, manufacturers must issue revised price lists (Form V/VI) to ensure patients benefit from lower GST without changes to packaging.
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Is GST Included in MRP?
Yes. The Maximum Retail Price (MRP) is always inclusive of all taxes, including GST.
- Retailers cannot legally charge GST over and above the printed MRP.
- MRP = Base Price + GST.
During the transition, even if old MRPs are visible, you should only be charged the revised amount reflecting the tax cut.
How to Calculate Revised MRP After GST Cut
Both businesses and consumers can calculate the revised MRP after a GST rate change using a two-step method.
Step 1: Find the Base Price
The base price is the pre-tax value of the product.
Base Price=Old MRP×100/ (100+Old GST Rate)
Step 2: Apply the New GST Rate
Once you have the base price, apply the new GST rate:
New MRP=Base Price+{Base Price×(New GST Rate/100)}
Example:
Suppose the old MRP of a packaged food item is ₹1,180, with GST at 18%.
- Base Price = (1180 × 100) ÷ 118 = ₹1,000
- With the new GST rate of 12%, the revised MRP = ₹1,000 + (1000 × 12 ÷ 100) = ₹1,120
So, the revised MRP after the GST cut is ₹1,120.
Let’s go through another table with the calculation of new MRP after the new GST changes.
| Product Example | Existing MRP (₹) | Old GST Rate | New GST Rate | Base Price (₹) | GST Reduction (₹) | New MRP After Cut (₹) |
|---|---|---|---|---|---|---|
| Packaged Food Item | 1,180 | 18 % | 5 % | 1,000 | 123 | 1,057 |
| Household Cleaner | 590 | 18 % | 5 % | 500 | 40 | 550 |
| Pack of Biscuits | 118 | 12 % | 0 % | 105 | 13 | 105 |
| Baby Lotion | 236 | 18 % | 5 % | 200 | 26 | 210 |
| LED Bulb | 472 | 18 % | 0 % | 400 | 72 | 400 |
Suggested Read: New GST Rates List 2025
Is GST Applied on MRP or Discounted Price?
This is one of the most frequently asked questions by consumers. The answer is straightforward:
- On MRP: The MRP already includes GST. You should never be charged additional tax over this printed or revised price.
- On Discounts: When discounts are applied, GST is calculated on the discounted transaction value, not the original MRP.
Example:
Imagine a product with an MRP of ₹1,000 (inclusive of 18% GST). A retailer offers a discount of ₹200, reducing the base price to ₹800. GST at 18% is then calculated on ₹800.
- GST = ₹144
- Final payable = ₹944
This ensures discounts benefit the customer while maintaining tax compliance.
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Consumer Vigilance: How to Check Actual Price After GST Cut
Since re-labelling is voluntary, consumers must remain proactive. Here’s how you can protect yourself:
- Look for stickers with revised MRPs.
- Check store notices or dealer lists for updated prices.
- Ask retailers whether the GST cut benefit is applied.
- Refer to company announcements (for example, Tata Consumer Products confirmed lower MRPs from 22 September 2025).
- Use formulas or calculators to cross-check prices yourself.
If charged unfairly, you can file complaints under the Legal Metrology Act, 2009, the Consumer Protection Act, 2019, or report through the INGRAM grievance portal.
Penalties for Overcharging or Non-Compliance
The Legal Metrology Act, 2009, provides strict penalties to safeguard consumers.
| Violation | Penalty |
| Overcharging beyond MRP | Fine up to ₹25,000 (first offense), up to ₹1 lakh or 1 year imprisonment (subsequent) |
| Incorrect declaration of MRP | Fine up to ₹25,000; up to ₹1 lakh for repeat cases |
| False/misleading information | Fine up to ₹2 lakh or imprisonment up to 3 months |
Additional risks for businesses:
- Product recalls.
- Damage to brand reputation.
- License suspension or cancellation.
Suggested Read: New GST Rates Effective from 22 September 2025
Quick MRP Checklist for Consumer After GST Cut
To make sure you benefit from the GST reduction:
- Check for revised MRP stickers on packaging
- Look for updated store price lists
- Ask retailers about GST benefits
- Refer to the company-issued revised MRPs
- Use GST/MRP calculators to verify fair pricing
- Report violations via INGRAM or to Legal Metrology authorities
Conclusion
The revised MRP after GST cut is designed to pass tax savings directly to consumers, even though businesses are not required to re-label every product immediately. While packaging with old MRPs will remain valid until March 2026, consumers must stay alert, checking stickers, store notices, or announcements, and verifying prices using formulas or calculators.
Remember, MRP already includes GST, and no retailer can charge beyond it. Discounts apply before GST is calculated, ensuring additional savings. If overcharged, strong legal protections under Legal Metrology and Consumer Protection laws give you the right to seek redress.
By being vigilant, you can ensure the benefits of GST reforms truly reach your pocket.
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