Odisha Chief Minister Naveen Patnaik on Friday requested Prime Minister Narendra Modi to exempt handloom and handicraft products from the Goods and Services Tax (GST).
In a letter to the Prime Minister, Patnaik urged that this issue needs urgent reconsideration in the GST Council for extending GST exemption on these products in the interest of the weavers and artisans.
Informing that Odisha is well known for the production of handloom and handicraft products, the Chief Minister said a large number of weaver and artisan families, exceeding 3.5 lakh, earn their livelihood from this diverse production base, which is next only to agriculture.
“Odisha’s handloom and handicrafts form an important part of our cultural heritage. These products are mostly used by the common people. Therefore, prior to introduction of GST, the state government had always exempted these products from Value Added Tax (VAT). In most of these products, there was also no excise duty,” informed Patnaik.
He said with the introduction of GST with effect from July 1 this year, handloom fabrics and handloom apparels have been made taxable with GST rates of 5 per cent and 12 per cent respectively and handicrafts have been levied a GST rate of 12 per cent or 18 per cent depending upon the type of handicraft.
“Although my Finance Minister had strongly argued in the GST Council that handloom and handicrafts should be kept in the exemption list, it was not agreed to. This is likely to lead to increase in prices of these products, which will adversely affect the livelihood of the poor families depending upon the production of these goods,” said the Chief Minister.