GST hike: Kerala traders urge FM to reconsider tax rates
What's the story
The Kerala Textile and Garments Dealers Association has requested the Finance Minister to reconsider the revised Goods and Services Tax (GST) rates of 18% on the apparel sector. The association argued that the new tax regime would have a significant impact on the market. The limit for tax-free sales was raised from ₹1,000 to ₹2,500 under the new rates, with an 18% tax levied on sales exceeding this amount.
Tax impact
Traders, consumers to be heavily burdened
The association questioned the adequacy of the increased tax-free sales limit in light of inflation over the past eight years. They argued that an average consumer spends around ₹2,500 on clothes during festive seasons. The introduction of an 18% tax on such purchases would heavily burden both consumers and traders alike.
Market crisis
Crisis worsens for clothing traders in Kerala, Tamil Nadu
The GST hike has further worsened the crisis for clothing traders in Kerala and Tamil Nadu. Individual firms, especially those dealing in wedding and traditional wear, are likely to be severely affected by this new tax regime. T S Pattabhiraman, President of The Kerala Textile and Garment Dealers Association, has urged the government to reconsider its decision and implement a uniform rate across all categories.
Market struggles
Urgent need for GST rate reduction
Pattabhiraman also highlighted the challenges faced by the Indian apparel market, which is heavily dependent on foreign markets. He urged the government to reduce GST rates for this sector, which employs hundreds of thousands of people and is now fighting for its survival. The association's plea comes as a major call for relief amid rising costs and economic pressures on India's textile industry.