The South India Garment Association (SIGA) has hailed the union finance minister Arun Jaitely for converting GST into a reality and appreciated the concept of one nation one tax policy and suggested for an uniform rate of tax by levying same rate on Yarn and fibre, finished and processed fabrics and ready made garments.

In a memorandum to the finance minister, the association mentioned about the present discrimination between branded and unbranded garments.

It said the garment industry is most complexed and sensitive one governed with many complications in manufacturing with very high rate of rejection due to many reasons as well as fashions cycle, also run by climates, regional traditional wears and so on. In such Scenario tax rates play a major role to sustain garment trade and industry, the association said.

Mere attaching a label garment becomes branded and falls under purview of excise duty is affecting the industry adversely. Most of the women and men’s traditional wear does not carry and label, while a section of manufacturers who are involved in manufacturing men`s casual and formal wear for mass market sale have no brand name or label are out of purview of levy of excise duty. This discrimination is causing unwanted unhealthy business practices because there is no specific definition of brand relating to garments, the association in its memorandum said.

“Hence we strongly suggest for no discrimination between branded and unbranded garments under GST. Lower Rate of tax will boost better compliance while GST inchain system will prove successful”, the association added.

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