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

“Oversights and anomalies in GST”- Sanjay Jain

Oversights and anomalies in GST Sanjay Jain

 

Sanjay K Jain, Chairman NITRA and Vice Chairman CITI , while extending thankfulness towards Honourable Ministers, Arun Jaitley and Smriti Irani for having understood well and keeping the cotton value chain and garments (1000) under 5% GST slab. That will ensure, according to him, “That there is no inflation for the common man due to GST. It has been a very balanced GST announcement overall. GST would benefit the industry in terms of lower logistic costs, low lead times, make pan India selling easier by removal of Forms needed, reduce administrative hassles by creating a single tax window, reduce costs by allowing taxes in all expenses to be adjusted etc. Overall the industry is very happy with the GST rates and so are the consumers.

However, he says, “There are a few oversights and anomalies which we hope will get corrected in due course”. The anomalies are as:

Oversights and anomalies in GST

 

• Textiles is a very fragmented and unorganised industry. Mostly manufacturers just do a single process and hence a lot of job working is involved. Pre GST it was recognised as a manufacturing acitiity and exempted from service tax. However such exemption is missing in the current GST exemptions for services. This means it would have a 18% GST rate which would make the job work segments and their principals uncompetitive against large composite mills who will not have this impact due to inhouse production. We have represented to the Government with all facts and are hopeful that this shall get suitably modified in the next GST Council meeting

• Synthetic chain is impacted due to the inverse rate structure – fibre and yarn enjoy 18% GST while fabric & garments have 5%. This problem is further accentuated due to disallowance of refund of excess GST on input. Further this will also lead to flood of imports of fabric as GST on imports will be 5%, while effective tax incidence on domestic fabric will be close to 10%

• This GST structure will lead to more cotton consumption, due to duty variance of 13%. We have requested to reconsider and reduce synthetic yarn duty to 12% to make it more equitable or atleast allow refund of excess credit if any.

• Another indirect fallout from GST, is the big threat of imports of fabric and garments from China, Bangladesh and Sri Lanka. Earlier imports had a 12.5% CVD which wasn’t adjustable. Now they would attract 5% GST which is adjustable against subsequent sales. Hence post GST the industry will be relatively disadvantaged by 12.5% vis a vis its peers abroad. This could create a very big issue as 12.5% in textiles is more than the net profit of most manufacturers. We shall need to approach the Commerce and Textile Ministry to work out some solution to save the industry from this impending avalanche by increasing import customs duty on textile products.

He concludes, “We hope the above anomalies are corrected soon, so our Industry can focus on accelerated growth as the uncertainty of GST is over. However, if these small but high impact irritants are not removed – we could see a big hit in the industry.”

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

At AW17 Junior’s Fashion Week, Mumbai brands showcase trendy styles

At AW17 Junior’s Fashion Week, Mumbai brands showcase trendy styles

  Mumbai hosted the two day Junior’s Fashion Week recently. The two-day event was hosted at Grand Hyatt. The Autumn Winter 2017 edition of Junior’s Fashion Week, brought into spotlight trendy,... Read more

Park Avenue by Raymond to make comeback with new retail concept

Park Avenue by Raymond to make comeback with new retail concept

  Raymond’s youthful clothing line, Park Avenue, will re-open its first New Delhi store after a brand and retail makeover in November. Sharad Walia, Brand Director, Park Avenue says the new... Read more

Arvind Internet changing the fashion retail game

Arvind Internet changing the fashion retail game

  Sharing the same passion of using technology and data to identify customers, Kulin Lalbhai took Mukul Bafna onboard to strike an Internet revolution by establishing Arvind Internet. Their idea was... Read more

India’s lingerie industry witnessing a dramatic design shift

India’s lingerie industry witnessing a dramatic design shift

  The lingerie industry has undergone a sea of transformation in the past few years. It holds the largest market share in India with high returns. With changing preferences and fashion... Read more

Max Fashion targets becoming a Rs 5,000-crore brand in three years

Max Fashion targets becoming a Rs 5,000-crore brand in three years

  Max Fashion, which is owned by Dubai-based $9 billion Landmark Group is growing at a CAGR (compound annual growth rate) of 32 per cent year on year and targeting achieving... Read more

Jealous 21 to launch Do & Diva denim in coming months

Jealous 21 to launch Do & Diva denim in coming months

  Having started its operations in 2005, Jealous 21 has come a long way since then. With a product basket comprising denims, dresses, tops, etc, the company has redefined Indian women’s... Read more

Wazir Textile Index: Q1 reflects overall sales growth in T&A mill sector

Wazir Textile Index: Q1 reflects overall sales growth in T&A mill sector

  The latest Wazir Textile Index (WTI) highlights that raw material prices increased in Q1 FY18 compared to Q1 FY17. On an average, raw cotton, viscose staple fibre and polyester staple... Read more

Anushka Sharma launches signature apparel line Nush

Anushka Sharma launches signature apparel line Nush

  Bollywood star Anushka Sharma, whose personal style is aesthetic, elegant and relatable wears a bit of herself in all that she sports. Her signature apparel line, Nush is a highly... Read more

Apple Eye to focus on character clothing, opt for innovative marketing

Apple Eye to focus on character clothing, opt for innovative marketing

  Kolkata-based kids’ brand Apple eye was launched in 2009 with inspiration from parents’ feeling for their children: ‘apples of their eyes’. The company started commercial production in 2010. “The place... Read more

Khadi: The humble fabric now belongs to the future

Khadi: The humble fabric now belongs to the future

  Gandhi Jayanti is also about celebrating all things uniquely Indian, like khadi. With the rise of everything handcrafted in fashion, khadi, too, has seen a new lease of life. Now,... Read more

MOST POPULAR NEWS
Go to top