The GST Council at its 22nd meeting in New Delhi has decided to reduce the Goods and Services Tax (GST) rate on man-made yarn from 18 per cent to 12 per cent. The GST on job work of zari (embroidery) has also been dropped from 12 per cent to 5 per cent, finance minister Arun Jaitely said.
The GST rate has been reduced to 12 per cent from the earlier 18 per cent on sewing thread of manmade filaments, whether or not put up for retail sale; all synthetic filament yarn, such as nylon, polyester, acrylic, etc; all artificial filament yarn, such as viscose rayon, Cuprammonium; sewing thread of manmade staple fibres; and yarn of manmade staple fibres, according to an official source. The GST rate on real zari has been decreased from 12 per cent to 5 per cent.
Indian Texpreneurs Federation (ITF) on hearing the announcement said, “The whole textile sector including man-made fibre (MMF) will grow with such an efficient GST structure. With GST Council’s historic decision of changing 18 per cent to 12 per cent rate for MMF yarn, we are confident about the growth of the entire value chain and India can make more blends and capture more market share in global market. Once again, our Union government has proved that it’s a listening government to the genuine requests of the manufacturing sector.”
The new GST rates will make it easier for small and medium enterprises (SMEs) with an annual turnover of up to Rs 1.5 crore, the GST Council has decided to allow these companies to file quarterly income returns and pay tax, instead of the current provision of monthly filings.
At a press conference after the GST Council meeting, Jaitley announced that processing of refund cheques for July exports would begin by October 10 and for August exports by October 18. He also announced the decision to refund a notional amount for the remaining months and later adjust the amount in the e-Wallet that will be implemented from April 1, 2018.
In the meeting, the Council also increased the threshold for composition scheme in GST from Rs 75 lakh to Rs 1 crore. This step is expected to reduce compliance burden on medium and small taxpayers.
Traders and manufacturers opting for the composition scheme have to pay 1 per cent and 2 per cent tax respectively without going through tedious formalities. So far, more than 15 lakh out of the 90 lakh registered businesses have for the composition scheme.
– Apparel and Textile News, Apparel Talk, Indian Apparel
