FMCG Majors Issue Trade Notices as GST Reduced on Household Essentials
Since the GST rates on household items have been reduced, top companies like Hindustan Unilever, P&G, and L’Oréal have communicated to their sellers that the government has reduced the GST (Goods and Services Tax) on many household products. These include soaps, shampoos, and other daily-use items.
The reduced rates are applicable from September 22. Many fast-moving consumer goods (FMCG) companies are informing their distributors about price changes, special offers and how they will shift to the new lower GST rates.
Hindustan Unilever has also come up with a ‘Retailer Bonanza‘ from September 11 to September 20, 2025, such as 4% on all soaps (other than Moti), 7% on Moti soaps, 20% on small and medium shampoo bottles, 10% on large bottles, and 20% on XL & XXL packs. Indulekha oil also has a 7% offer, and Clinic Plus & Clear oils have 11%. The Horlicks and Boost are 5%. The Pepsodent and Close Up an 8% offer, and beverages such as Red Label premix, coffee, etc., have 7%.
L’Oréal India has also informed its trade partners regarding the reduced rate of GST on shampoos and face powders from 18% to 5%, effective from September 22, 2025. They also informed us that the Invoices up to September 21 will still be made at the current GST rates. From September 22, the invoices will show the revised GST rates. The company also said that it is working to update its maximum retail prices (MRPs). it also assured retailers that products bought before the price changes but sold after the prices were revised will still qualify for the full input tax credit (ITC).
However, the GST rates on other products like skincare, perfumes, hair colour, etc., will remain the same at 18%.
Himalaya Wellness Co. has informed its trade partners that several of its popular personal care items, including baby shampoo, soap, powder, hair oil, and even products like Party Smart and diaper rash cream, will now be taxed at a lower 5% rate instead of the earlier 12% or 18%. Baby nappies are also getting cheaper with the GST coming down from 12% to 5%.
But GST rates on other items like face wash, lotions, serums, wipes, massage oils, hand wash, lip balm, etc., will remain unchanged. The company also gave assurance to the trade partners, saying that they will get full ITC on the earlier rates.
Procter & Gamble has introduced a “GST Special Offer” due to the GST rate revision. Between September 10, and September 21, the retailers will get an extra 10% top-up on products shifting from 18% to 5% GST. These products include Pantene, Head & Shoulders, Gillette Personal Care, Old Spice, and Oral-B. Also, an additional 5% top-up for the goods moving from 12% to 5% GST like Pampers, Vicks, etc.
On the other hand, Mankind Pharma, which sells brands in consumer products and over-the-counter, shared that after the GST new rate is announced, the inventories purchased by retailers at 12% GST will be sold at the reduced rate of 5%. The company also gives assurance that the GST ITC on the 12% rate would still be available. However, due to the transition, there will be a short delay in this. Therefore, the retailers will not have to face any financial losses.
Since the rates have reduced from September 22, the companies are urging retailers to build up their stocks now so they can offer better prices to shoppers and boost demand ahead of the festive rush.
