Business India

Congress to raise textile traders’ concerns in GST Council meeting

The Congress on Friday said it will raise the issue of small manufacturers and traders in the textile sector at the GST Council meeting on Saturday and added that they are the hardest hit by “distorted duty structure of GST”.

The party said it was committed to raise the issue of livelihood, employment, trade and business of small traders in the Goods and Services Tax (GST) Council meeting being held in Hyderabad.

Apart from Gujarat, an “insurmountable loss of jobs” had happened in Bhiwandi and Malegaon (Maharashtra), Ludhiana (Punjab), Tirupur (Tamil Nadu) and other centres, the party said.

It also said the government must consider to provide appropriate relief to the textile traders, and that the exemption limits for traders must be raised from the existing Rs 20 lakh to Rs 1 crore and for manufacturers from Rs 50 lakh to Rs 2 crore.

“The Central government has claimed a total GST collection of close to Rs 92,000 crore for the month of July 2017. These collections camouflage nearly Rs 30,000 crore to Rs 40,000 crore of likely taxes that were available as transitional credits, but could not be taken because of the glitches in GST Network and confusion created by the government.

“Net of these credits tax collections would be far less, creating serious doubts both about the GDP growth as well as tax numbers,” said Punjab Finance Minister Manpreet Singh Badal, adding there was shortfall of almost Rs 800 crore in the revenue of Punjab.

The textile industry was the worst-affected sector, he said.

“Micro and small manufacturers, traders, cloth merchants and shopkeepers in the textile sector, which is the second biggest job generator after agriculture, are the hardest hit by the distorted duty structure of GST,” Badal said.

“It hit millions of small powerlooms as the GST tax structure has been designed only to help integrated plants in this sector. Similar is the fate of cloth merchants, traders and shopkeepers,” he added.

The Congress said the strike in the textile sector had already caused an estimated loss of nearly Rs 40,000 crore across the country and a loss of nearly 15 lakh jobs. Some 12 crore people are engaged in the textile sector.

“Manmade fibres are nearly 60 per cent of Indian fibre demand. Manmade fibre and yarn, dyeing and printing units and embroidery are being taxed at 18 per cent, while rate on the end product, i.e. fabric, is only five per cent,” Badal noted.

“This is proving to be a deathknell for the small and micro non-integrated textile players, while helping only the biggest fish to sustain,” said Badal.

Karnataka Minister Krishna Byre Gowda raised the issue of taxpayers not being able to file their returns every month because of the glitches in the online portals.

“Many people are unable to file their returns. They are having lots of difficulty. So, there is latent tax revenue which could have come but has not come on account of GSTN and preparedness issues,” he added.

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