Tamil Nadu powerloom sector asks for GST exemption

Tamil Nadu Powerloom Federation Limited has asked the state's chief minister Edappadi K Palaniswami to urge the Central government to exempt the powerloom sector from the Goods and Services Tax (GST). As per the federation, the new tax regime and its online compliance format will force lakhs of small-scale weavers to give up their livelihoods.

Indirect tax is currently being levied on spinning, dyeing, printing, bleaching and apparel manufacturing and bringing the 'in-between activity' of weaving under GST will not be feasible, said MS Mathivanan, president of the federation, while speaking to the media.

The GST Council has currently exempted weaving units with a turnover of less than Rs 20 lakh with a condition that the sales should only be made within the state. However, according to the federation president, this makes little sense considering that woven fabric is sold by weavers to master weavers who then sell them to exporters and traders.

Mathivanan added that weavers are most likely to be illiterate and they cannot be expected to comply with the GST online registration and return filing process. The powerloom sector will be forced to stop yarn purchase, if appropriate steps are not taken in this regard during the next GST Council meeting, said Mathivanan.