The two largest Fast Moving Consumer Goods (FMCG) businesses, Hindustan Unilever Ltd. and Procter & Gamble, have reportedly started paying their GST due in part payment under the cross charge mechanism.
According to the CGST Act’s provisions, a tax will be applied to any supply of goods or services made without payment from one person to another. When two company units have different GST registrations, they will be regarded as separate companies or people.
As per the reports, the Director General of GST Intelligence (DGGI) may further enquire into unpaid GST dues under the cross charge mechanism by other FMCG companies and issued a notice to the companies 15 days ago.
Hindustan Unilever stated that the previous week, in response to the query, they had fully and transparently supplied data to GST officials. The company added that there had been no accusations of tax evasion from the GST Administration.
According to P&G, they take their responsibilities to comply with local rules and regulations very seriously. They are solely devoted to doing so. When there are any concerns, they work with the appropriate authorities and communicate openly with them, as recently happened with the Tax authorities. They have not been accused of tax evasion.
In this sector, some of the biggest businesses in the world, including Tyson Foods, Coca-Cola, Unilever, Procter & Gamble, Nestle, PepsiCo, and Danone, compete for market share. To intrigue and attract customers to acquire their items, businesses like these must concentrate their marketing efforts on fast-moving consumer goods.
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