Feedback
A pioneer B2B media and publication platform connecting with Fashion Brands & Retail in India

GST council cuts rate to 5 %, great relief to Indian textile, garment industry

GST council cuts rate to 5 great relief to Indian textile

This 5 percent GST rate reduced from 18 per cent announced earlier, will be applicable for job works in apparel, shawls and carpets.

Acceding to demands from the industry, The Goods and Services Tax (GST) Council decided to reduce the GST rate on all job works related to the textile and apparel sector to 5% from 18%. In case of some sectors like yarns and fabrics, the tax on job works was earlier slashed to 5%, but with Saturday’s decision, the benefit of lower tax will be available to all job works in the sector. In a move that would cut the cost of project execution in the government sector, the GST on work contracts in the state-sector has been reduced 18% to 12% with full input tax credit.

SIMA hails GST reduction on textile job work.

GST council cuts rate to 5 great relief to Indian textile garment industry

The Southern India Mills Association (SIMA) welcomed the centre's move to bring down the GST rate on textile job work from 18 per cent to 5 per cent. All the textile job works, being the manufacturing activities, had been exempted from the service tax in the pre-GST regime. But, the job workers could not avail the input tax credit that had been increasing the cost of the products and affecting the export competitiveness and also the domestic consumers, a release from SIMA said.

Therefore, the industry has been demanding to classify all the textile job works under 5% GST rate service list. But, the GST council had classified only the textile yarns (other than MMF and filament) and textile fabrics under 5% and therefore all other job works especially garments and made-up that creates 70 to 120 jobs per Rs 1crore of investment, especially for the rural masses and women folks were affected due to inverted duty. In addition, over 85% of the textile manufacturing units under take only job work.

M Senthilkumar, chairman of SIMA said 5 per cent GST rate on job works would enable to take full input credit and also avoid any inverted duty and strengthen the global competitiveness of the textile industry apart from benefiting the domestic consumers.

Garment manufacturers cheer GST rate cut in job work.

Garment manufacturers too have welcomed the government's decision to cut service tax (goods and services or GST levy) on the third-party services popularly known as job work.

"We welcome the decision. This is a major relief for the garments sector. The rate of 18 per cent was the biggest impediment for the growth of the garments sector. With this relief garment sector in India will see a major jump in coming days," said Rahul Mehta, President, Clothing Manufacturers Association of India.

In the unorganised garment sector, almost 75 per cent depends on job work such as stitching, trading and other associated work. The sector feared hundreds of thousands of job losses with high tax on third party work.

LATEST TOP NEWS
  • 1
  • 2
  • 3
  • 4
  • 5
  • 6
  • 7
  • 8
  • 9
  • 10

Global brands resizing retail stores to become profitable

Global brands resizing retail stores to become profitable

  With Indian retail witnessing a makeover of sorts under the influence of e-commerce, leading brands are looking at right-sizing their outlets. Three American clothing and accessories brands — Gap, Forever21... Read more

Kishore Biyani’ Retail 3.0, outlines future business strategy

Kishore Biyani’ Retail 3.0, outlines future business strategy

  Kishore Biyani recently unveiled his grand vision, titled Retail 3.0 – a 30-year roadmap on how he expects the Future Group’s second innings in retail to pan out. In his... Read more

Soch plans international expansion

Soch plans international expansion

  Ethnic brand Soch, is planning to retail in countries like the US, UK, Canada, Australia, South Africa, Mauritius, Singapore, Indonesia, Malayasia and UAE by April 2018. Much like global fashion... Read more

Cadini plans retail expansion in state capitals and Tier II, III cities

Cadini plans retail expansion in state capitals and Tier II, III cities

  Founded in 1970 in Florence, Italy as a manufacturer of men’s garments and accessories, Cadini has continuously grown, maintaining a great passion for style, quality and, research. The name ‘Cadini’... Read more

FBB to reach a 100 standalone stores by next year

FBB to reach a 100 standalone stores by next year

  With 60 standalone stores at the moment, FBB is aiming for 100 stores by FY18. FBB has a presence in 250 Big Bazaar outlets, and will cross 310 stores by... Read more

Neva focuses on innovative concept ‘Clothing for Life’

Neva focuses on innovative concept ‘Clothing for Life’

  Established in 1998, Neva’s initial innovative practice still resonates across the thermal inner wear industry. Although Neva gained the indisputable market leader position through its innovative and quality products, it... Read more

Woodland to open 40 stores annually, expects increase in 15 per cent revenue

Woodland to open 40 stores annually, expects increase in 15 per cent revenue

  Adventure footwear and apparel maker Woodland plans to add 40 stores annually and scale up its new launched premium brand ‘Woods. It is expecting a revenue jump of 15 per... Read more

Force NXT from Dollar aims to break youth stereotypes

Force NXT from Dollar aims to break youth stereotypes

  Force NXT is Dollar’s ultra-premium brand, designed to keep in mind every flavour of the year. It’s been two years since Force NXT was launched and in a short span,... Read more

Toonz Retail focusing on Tier II, III expansion

Toonz Retail focusing on Tier II, III expansion

  Having opened their first store in 2010, in Bengaluru, Toonz Retail today is successfully operating more than 100 stores spread across 62 cities in 15 states including Delhi, Karnataka, Andhra... Read more

Season 2.0 of India Intimate Fashion Week in early summer 2018

Season 2.0 of India Intimate Fashion Week in early summer 2018

  After achieving a remarkable feat in its debut edition, the much awaited India Intimate Fashion Week (IIFW) is all set to host its second season, early next summer in Mumbai.... Read more

MOST POPULAR NEWS
Go to top