New Delhi: The Goods and Services Tax (GST) council, chaired by Finance Minister Nirmala Sitharaman, decided on December 31 to postpone the rise in the textile duty from 5 per cent to 12 per cent due to opposition from states and industry.
Earlier, many Indian states opposed the increase in textile tariffs and asked for a reprieve. The matter has been brought by states including Gujarat, West Bengal, Delhi, Rajasthan and Tamil Nadu. The states said they did not support an increase in the GST rate for textiles from the current 5 per cent to 12 per cent from January 1, 2022.
Currently, India levies a 5% tax on each sale of up to Rs 1,000, and the GST Board’s recommendation to raise the textile tax from 5% to 12% would affect a large number of small traders who trade. In the textile sector, even consumers will be forced to pay exorbitant fees if the rule is implemented.
India’s textile industry opposed the proposal, saying the decision could have a negative impact, leading to a drop in demand and economic recession.
India’s finance minister told a news conference that the meeting was called on an emergency basis. Sitharaman said the meeting was called after Gujarat’s finance minister asked for a postponement of the decision on tax structure inversion to be taken at the September 2021 council meeting.
Post time: Jul-11-2022