Representatives of the garment sector has demanded that uniform GST slab rate should be fixed at 5%. Currently there are two tax slabs – 5% for bills below Rs 999 and 12% for bills above that. Whereas, the government has proposed to fix it at 12% for both slabs. If it goes through, will hit the ‘already battered’ industry and may lead to job losses, industry insiders fear.
A recent study by the Garment and Textiles Workers’ Union (GATWU) estimated that at least 60 garment factories shut down and nearly 40,000, mostly women, lost jobs, in Bengaluru alone since the pandemic.
In such a situation, hiking GST to 12% would lead to a further fall in demand and will eventually hit us workers. It will only mean more closures, loss of jobs and salary cuts. This is the time the government must stand by the sector,” Mr. Jayaram, advisor to GATWU said.
In a letter to Chief Minister Basavaraj Bommai, who was recently appointed chairman of the Group of Ministers on GST Rate Rationalisation, Perikal M. Sundar, president of Federation of Karnataka Chamber of Commerce and Industry, (FKCCI), said, “This sector may face closure leading to unemployment and loss of revenue to the government.”
Industry representatives recently met the CM and petitioned him seeking a uniform 5% GST slab for the sector. “Earlier, Mr. Bommai, acting on our petition, has written to Union Finance Minister Nirmala Sitharaman seeking a uniform slab of 5%. Now that he chairs the rate rationalisation committee himself, we hope he will honour his commitment,” said Mr. Sajjan Raj Mehta, of Karnataka Hosiery and Garments’ Association.