sitemapHome | Registration | Job Portal for CA's | Expert Exchange | Currency Converter | Post Matrimonial Ads | Post Property Ads
News shortcuts: From the Courts | News Headlines | VAT (Value Added Tax) | Placements & Empanelment | Various Acts & Rules | Latest Circulars | New Forms | Forex | Auditing | Direct Tax | Customs and Excise | ICAI | Corporate Law | Markets | Students | General | Mergers and Acquisitions | Continuing Prof. Edu. | Budget Extravaganza | Transfer Pricing | GST - Goods and Services Tax
Latest Expert Exchange
Service Tax »
 12 ways to avoid paying more for bank services
 I-T return filing: Income Tax offices, Ayakar Seva Kendras to remain open from March 29-31
 Top 5 money matters you must settle before March 31 From income tax returns to LTCG,
 Steep fines for missing March 31 income tax deadline
 CBEC clears some air on refunds under GST, central excise, service tax laws
 3 key tax changes for senior citizens which will come into effect from April 1, 2018
 Income tax returns (ITR) filing: Not filed returns for 2 years? Beware! Deadline nearing
 All you want to know about HRA: When you can claim and how it is calculated?
 Income Tax Saving: 6 ways to save tax without investing before March 31 tax deadline
 Unnable to file your tax return? Take help of these portals
 Do you know which 80C instruments can help you save tax and carry no future tax liability?

GST rates for knitwear production chain to create more complexities
June, 05th 2017

Varied Good and Services Tax (GST) rates set for different segments of ‘knitwear production chain’ looks to create complexities in a cluster like Tirupur and also a consequential fear among the apparel exporters of a possible shrinkage in profit margins.

The main annoyance of the exporting community and technocrats is the lack of clarity on the fate of the duty drawback scheme post implementation of GST regime.

“Unless the duty drawback rates are made clear, the profit margins can shrink. It is because the central excise, and the service tax components in the drawback are going to get integrated with the GST and only the customs duty component that comes to just over 2 % will be there outside the GST purview”, pointed out Tirupur Exporters’ Association president Raja Shanmugam.

“Tirupur exporters might not be able to pass on financial burden arisen by cut in refunds, to the buyers. Global market is price sensitive and many of our competitors are already enjoying preferential trade tariffs”, said S. Dhananjayan, a senior chartered accountant and financial advisor to many industrial bodies.

The different GST scales fixed for various processes in the apparel production chain is going to have ramifications considering that the production chain in Tirupur cluster remains mostly disintegrated.

“Complexity will arise as job works are going to be taxed at 18 % even though garments attract only 5 %. In Tirupur, processes like dyeing, knitting, fabrication and printing among many others were being carried out as job works,” said Mr. Dhananjayan.

Special Correspondent adds from Coimbatore: Chairman of Confederation of Indian Textile Industry J. Thulasidharan said the 18 % GST rate on man-made fibre and synthetic yarn would have inverted duty structure problem as the fabric was under the 5 % rate.

The high rates for man-made fibre and yarn would lead to an increase in input costs and adversely affect the synthetic sector. The Indian textile and apparel sector faced competitive challenges from the neighbouring countries and keeping the tax rates high will only escalate textile inflation. Welcoming the low rate for cotton textile sector, Mr. Thulasidharan said the Government should reconsider the rates of MMF products and bring it to 12 %.

Home | About Us | Terms and Conditions | Contact Us
Copyright 2018 CAinINDIA All Right Reserved.
Designed and Developed by Binarysoft Technologies Pvt. Ltd.
Binarysoft Technologies - Sitemap

Transfer Pricing | International Taxation | Business Consulting | Corporate Compliance and Consulting | Assurance and Risk Advisory | Indirect Taxes | Direct Taxes | Transaction Advisory | Regular Compliance and Reporting | Tax Assessments | International Taxation Advisory | Capital Structuring | Withholding tax advisory | Expatriate Tax Reporting | Litigation | Badges | Club Badges | Seals | Military Insignias | Emblems | Family Crest | Software Development India | Software Development Company | SEO Company | Web Application Development | MLM Software | MLM Solutions