GST Price Drop REVERSED? Amazon's Shocking Price Discovery After Tax Cuts Revealed!

Consumer Products

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Updated on 12 Nov 2025, 05:04 pm

QuantEco Research's report, "GST induced cuts: Price discovery continues," examined online prices of consumer goods on Amazon following Goods and Services Tax (GST) rate rationalisation in September 2025. The analysis, covering September 1 to early November 2025, found an initial median price reduction of 16.4 percent. However, approximately 6.3 percent of this drop has since been reversed, with reversals being more pronounced for medium and low-priced goods.

This ongoing adjustment, termed "price discovery," indicates that not all GST-induced price cuts are permanent. Factors like increased festive season demand, sellers clearing old inventory, and the depreciation of the Indian Rupee are contributing to these partial price rebounds.

Specific examples show significant initial drops followed by partial recoveries. An LG 55-inch TV price fell by 26.7% and remained steady. However, a Samsung Galaxy smartphone dropped 14.3% but has since recovered 13.3% of that fall. A Dell laptop saw a 16.4% cut and a 10% reversal. Everyday items like a juicer mixer (-12.6% drop, 14.4% rebound) and a Lego toy (-31.3% drop, 62.6% rebound) exhibited even sharper swings.

The report's findings are confined to Amazon India's listings and do not cover offline markets or product categories like auto or services with limited online sales.

Impact: This news provides insights into consumer price trends in India following GST adjustments. It affects the profitability and sales strategies of consumer goods manufacturers and e-commerce platforms. Investors can gauge the real benefit passed to consumers and its sustainability, which impacts overall inflation expectations and consumer spending, a key driver of the Indian economy. Rating: 7/10

Difficult terms: * GST: Goods and Services Tax. A consumption tax imposed on the supply of goods and services in India. * Price Correction: A decrease in the price of an asset or good. * Price Discovery: The process by which the market determines the appropriate price for a good or service. * Median: The middle value in a list of numbers sorted from smallest to largest. * Reversal: When a price trend changes direction; in this context, prices moving back up after falling. * Rupee Depreciation: A decrease in the value of the Indian Rupee relative to other currencies. * FMCG: Fast-Moving Consumer Goods – products that are sold quickly and at a relatively low cost, such as packaged foods, toiletries, and over-the-counter drugs.