FMCG companies emerge as the major beneficiaries of the GST tax regime-Study

GST council sealed the fate of 1211 items. The crucial meeting held on Thursday created a robust platform for the launch of the unified tax regime (GST) that is all set to change the tax landscape of the nation believes, market analysts. 

The GST tax layout will bring in new change for few consumer products. The companies catering to products in automobiles, cement, beverages, food items, personal care items as well as building material will feel the change after the GST will come into effect on July 1.

The balance rates and GST rate for services will be decided by the GST council on May 20. Most of the rate changes will be passed on to the consumers. The primary food products have been kept under 0-5 percent tax bracket. 

Kotak Ínstitutional Equities revealed in a note that FMCG companies emerged as key beneficiaries and stocks like Colgate, HUL as well as Pidilite Industries gained prominence in the markets after the announcement made by the GST council. 

Except hair oil, most personal care products will be taxed at 28 percent. Cakes, cornflakes, jams will be taxed at 18 percent while the rest will be between 5%-12%. Food and beverage items, aerated water, chocolates, chewing gum, malted food drinks will also come under the tax bracket of 28 percent.