Jun 5, 2017
Textile bodies hail 5% GST rates for cotton industry
Jun 5, 2017
Prominent textile and apparel industry bodies, including The Cotton Textiles Export Promotion Council (Texprocil), The Southern India Mills’ Association (SIMA) and the Tiruppur Exporters’ Association (TEA) have welcomed the rates announced for the industry by the Goods and Services Tax (GST) Council. The single tax is to be rolled out pan India from July 1.
At its 15th meeting, the GST Council classified all natural fibres including cotton, cotton yarn, fabrics and readymade garments valued below Rs 1000 under 5 per cent GST rate. Garments valued above Rs 1000 have been classified under 12 per cent GST rate, while the synthetic or man-made fibres and synthetic yarn have been classified under 18 per cent GST rate. Fabric, irrespective of fibre, has been classified under 5 per cent GST rate.
Welcoming the 5 per cent GST on cotton yarn and fabrics, Texprocil chairman Ujwal Lahoti said, “The rate of 5 per cent for cotton textiles is very progressive and will lead to the growth and development of the entire value chain.”
“We are happy that Finance Minister has accepted the Council’s suggestion for keeping the rates low in order to ensure compliance and encourage the farmers to grow more cotton,” Lahoti said.
The low rates will not cast any additional burden on the sector and will ensure that India regains its competitiveness in the textiles sector in world markets, he added.
Expressing similar views, SIMA chairman M Senthilkumar stated that 5 per cent GST rate on cotton fibre would sustain the competitiveness of over 20 million cotton farmers as this rate across the value chain would enable the cotton textile industry to remain globally competitive, achieve substantial growth rate and increase cotton fibre consumption and thereby increase the earnings of the farmers.
Thanking finance minister Arun Jaitley for fixing GST rate at 5 per cent for garments, including cotton, cotton yarn and fabrics, TEA president Raja M Shanmugham said this would help the predominantly cotton based textile industry to grow and also increase exports.
Copyright © 2021 Fibre2Fashion. All rights reserved.