CONCEPT – NATIONAL ANTI-PROFITEERING AUTHORITY - NAPA

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 CONCEPT – NATIONAL ANTI-PROFITEERING AUTHORITY - NAPA

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• Introduction: Any reduction in rate of tax on any supply of goods or services or the benefit of input tax credit should have been passed on to the recipient by way of commensurate reduction in prices. However it has been the experience of many countries that when GST was introduced there has been a marked increase in inflation and the prices of the commodities. This happened in spite of the availability of the tax credit right from the production stage to the final consumption stage which should have actually reduced the final prices. This was obviously happening because the supplier was not passing on the benefit to the consumer and thereby indulging in illegal profiteering. National Anti-profiteering Authority was hence constituted by the central Government to examine whether input tax credits availed by any registered person or the reduction in the tax rate have actually resulted in a commensurate reduction in consumer-level prices.
• Vision and Mission of NAA : The National Anti-profiteering Authority (NAA) is the institutional mechanism under GST law to check the unfair profit-making activities by the trading community. The Authority’s core function is to ensure that the benefits of the reduction is GST rates on goods and services made by GST Council and proportional change in the Input tax credit passed on to the ultimate consumers and recipient respectively by way of reduction in the prices by the suppliers.
• The formation of NAA came in the background of rate-reduction of large number of items by GST Council in its 22nd meeting at Guwahati. At the meeting, the Council reduced rates of more than 200 items including goods and services. This has made tremendous price reduction effect and the consumers will be benefited only if the traders are making quick reduction of prices of respective items. 
• Functions : The Authority’s main function is to ensure that traders are not realizing unfair profit by charging high price from consumers in the name of GST. The responsibility of NAA is to examine and check such profiteering activities and recommend punitive actions including cancellation of Registration. The chairman, NAA along with 4 Technical members and with help of the Standing Committee, Screening Committee in every state and the Directorate General of Safeguards in the Central Board of Excise & Customs (CBEC), will work together on the anti-profiteering front. 

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