Welcoming the Goods and Services Tax (GST) council’s move to reduce the rate for all job works in textile sector from 18% to 5%, the Confederation of Indian Textile Industry (CITI) has described the move as a big breather to small job work manufacturers in all segments of textile value chain and added that it would facilitate the free flow of business across the value chain.
CITI further said that with this relief, the textile industry can claim full input credit and it would also avoid any inverted duty and strengthen the global competitiveness of the textile sector apart from benefiting the domestic consumers. However, the industry body expressed disappointment on the postponement of reduction of GST rate for manmade fibre and synthetics from 18% to 12%.
At the same time, CITI expressed a need of some safeguard measures for the industry in order to ensure the Make in India initiative does not wash away in the avalanche of imports, noting that imports are now cheaper than domestic products as the countervailing duty (CVD) and special additional duty (SAD) on imports have become Integrated GST. The GST Council, headed by Finance Minister Arun Jaitley comprising representatives from all states, last week decided to tax all job works in the textile sector at 5 per cent.
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