Ludhiana industrialists seek rollback of hike in GST on textiles; submit memo with Union minister
Criticising the Union government’s decision to increase goods and services tax (GST) on garments/textile (of MRP less than ₹1,000) from 5% to 12%, members of Federation of All Textile Manufacturing and Trading Associations of Ludhiana submitted a memorandum with Union minister of fisheries, animal husbandry and dairying, Parshottam Khodabhai Rupala, in Delhi on Wednesday.
The industrialists demanded that the government roll back the decision as the sector is already struggling amid the pandemic and the increase in GST will further deepen the crisis. Also, prices of end products will increase, which will disturb the budget of lower and middle income families.
Chairman of the association Ajit Lakra and president Tarun Jain Bawa stated that over 85% products manufactured in the local market have MRP below ₹1,000. “This will certainly increase prices of end products, which is detrimental to the industry. Also, the working capital requirement will increase, as tax has to be paid every month, but payments from customers are realised after 4-5 months of delivery. This may also increase evasion of tax,” they said.
Lakra said that they met the Union minister so that the issue can be raised in the Prime Minister’s office. The minister sought suggestions from the industry and assured that the matter will be discussed thoroughly, he added.
Earlier, the group of industrialists under the banner of Bhartiya Aarthik Party (BAP), had announced a protest outside the residence of Prime Minister Narendra Modi over the issue on November 25. Bawa, who is also the president of the party, said that the agitation has been postponed after the minister has assured to take up the matter and resolve the problem being faced by the industry.