GST relief: Rate rejig set to ease daily expenses; PwC report says household budgets may get a breather

Household budgets in India are likely to get some relief after the recent revision in Goods and Services Tax (GST) rates, according to a report by PwC. The advisory firm noted that the rate adjustments are expected to make everyday expenses more manageable for consumers, potentially lifting overall consumption sentiment."With the revised GST rates, household budgets are likely to become more manageable," PwC said in its survey report, as per news agency ANI. The report added that about 63 per cent of consumers expressed concern over rising food prices. To manage costs, 44 per cent of respondents said they were buying in bulk, while an equal number reported growing their own food to offset inflation.PwC’s survey also highlighted that nearly half of those worried about food costs are changing their shopping habits by opting for different stores, discount outlets, and promotional deals. Further, 74 per cent of consumers said their food choices were rooted in cultural heritage and longstanding traditions. This, the report said, points to an advantage for companies offering functional heritage foods such as aam panna and jeera-flavoured drinks.About 32 per cent of consumers in the survey said they were "financially coping," while 7 per cent mentioned they were financially insecure and struggling to pay bills. "The GST relief is significant for families that previously faced fluctuations in vegetable prices and food inflation," the report added, noting that consumers are increasingly turning to discounts, coupons, and loyalty programmes.The GST Council on September 3 approved the streamlining of rates into a simplified two-tier system of 5 and 18 per cent, with a distinct 40 per cent bracket for specific luxury items such as tobacco and high-end vehicles. Everyday essentials, including ultra-high temperature milk, paneer, pizza bread, khakra, and chapati, will now be tax-free, effective September 22.PwC added that brands will need to adapt by "institutionalising regular promotional cycles and enhancing loyalty programmes" to support short-term conversions while fostering long-term retention in a volatile pricing environment.