With the Goods and Services Tax rolled out, questions continue to surface over how prices are being determined for goods with Maximum Retail Price, or MRP, labels. Concerns have been raised about whether GST is being charged on top of these prices and whether the government plans to introduce reference prices to prevent overcharging.
Many products sold in Bhutan are imported from India and carry MRP labels. However, officials from the Competition and Consumer Affairs Authority clarified that Bhutan does not follow the MRP system.
While the MRP system is legally enforced in India, it has little relevance in Bhutan, where shopkeepers set prices based on local market conditions.
“This concept of MRP is widely misunderstood. In fact, in Bhutan, we do not have this concept of MRP. But because most of our products come from India, this MRP is a system which is used in India. That is why when the product reaches Bhutan, we still see the MRP on it. But it has actually no relevance to what the shopkeeper or business should charge,” said Ugyen Penjore, Director General, Competition and Consumer Affairs Authority.
He added that introducing a common reference price for goods is not feasible, as Bhutan operates under a free-market economy where prices are determined by market forces, and not fixed by the government.
While MRP does not determine the selling price, businesses are not allowed to remove or alter the printed MRP.
“As per our Consumer Protection Act, you should not scrub off the MRP; this should be used as a guide for the customers to know what the actual value of the products. They will be able set their own prices on top of the MRP,” said Ugyen Penjore, Director General, Competition and Consumer Affairs Authority.
The authority also urged consumers to always ask for receipts, reminding businesses that issuing receipts is mandatory.
“According to our Consumer Protection Act, when you purchase things worth Nu 100 or more, businesses are supposed to give a receipt. The receipt is useful for consumers in case a product is faulty, spoiled, or if you are looking for a replacement. This receipt acts as evidence of purchase from that particular business,” said Ugyen Penjore, Director General, Competition and Consumer Affairs Authority.
As the GST system takes effect, authorities say consumer awareness and compliance by businesses will be key to ensuring fair pricing and market transparency.
Consumers are advised to report cases of unfair trade practices to the authority.
Deki Lhazom
Edited by Kipchu
