June 4, 2017
Major textile industry bodies today welcomed the decision of fixing reasonable GST rates to most of the categories and thanked Union Finance minister, Arun Jaitley for initiating faster decisions on the subject.
In his reaction, Regional Chairman Federation of Indian Exporters’ Organisation (FIEO) Southern Region, A Shaktivel said that the lower GST rates across the products which are having high export potential will go a long way in promoting “ Make in India”.
The leather and footwear sector, pharmaceuticals, food products, textiles got fair deal in taxation, Sakthivel said in a statement here.
On textile, he said that announcement of lower rates of GST for Fabrics, Natural Fibre, Apparels and Made-ups, etc. will enable increased value addition, employment and exports and propel domestic production across the sectors.
Sakthivel also said that the simplified procedure of job works by allowing movement of goods by Challan only will go a long way in developing supporting eco system much needed for garment industry’s competitiveness.
Indian textile industry estimated at 120 Billion Dollars worth today, can reach 230 Billion Dollars by 2020, if further impetus was given, so that export of raw materials including fibre and yarn can be replaced with more value added products.
Tirupur Exporters’ Association (TEA) also thanked Jaitley for considering the requisition and helping to fix GST rate at five per cent for garments including cotton, cotton yarn and fabrics.
This would help the predominantly cotton based textile industry to grow and also increase exports, TEA president, Raja M Shanugham said in a release today.
However, he expressed disappointment for fixing the GST rate at 18 percent for synthetic Fibre and Fabrics and noted that the garments units may find it difficult in offsetting Input Tax Credit.
The exporters were also concerned about the service tax fixed for job working units at 18 per cent where more than 80 per cent of garment exporting units in Tirupur cluster are carrying out the job working activities, he said and sought to exempt the the job working units in payment of Service Tax.
In a statement, Indian Texpreneurs Federation Secretary, Prabhu Dhamodharan said that the uniform and lowest slab GST in cotton segment up to fabric stage will make the textile manufacturing sector efficient and trigger growth across the country.