Tex­procil Wel­comes 5% GST for Tex­tile Job Work

Perfect Sourcing - - India News -

The Cot­ton Tex­tiles Ex­port Pro­mo­tion Coun­cil (Tex­procil) wel­comed the gov­ern­ment’s de­ci­sion to re­duce GST rate for job work in the tex­tile sec­tor.the Goods and Ser­vices Tax (GST) Coun­cil, in its meet­ing last week, de­cided to cut the tax rate for job work for the en­tire value chain of tex­tiles sec­tor to 5 per cent.

Ear­lier, the GST for job works re­lated to tex­tile yarns, other than man­made fi­bres and tex­tile fab­rics, was 5%, while for man­made fi­bres yarns and made ups/ gar­ments, it was 18%.

The re­duc­tion in the GST rate for job work in the made ups and gar­ment sec­tors is wel­come and as a pos­i­tive mea­sure which will bring down the costs for the tex­tiles sec­tor across the value chain. A ma­jor­ity of the man­u­fac­tur­ing ac­tiv­i­ties in the tex­tiles sec­tor take place through job work and the re­duc­tion in the GST rate has come as a huge re­lief for the said the chair­man, Tex­procil.

With re­gard to ex­ports, the chair­man added fur­ther that said the mer­chant ex­porters can­not ben­e­fit from the fa­cil­ity of ex­ports un­der bond/ Let­ter of Un­der­tak­ing (LUT). There is no en­abling doc­u­ment pre­scribed so far by the gov­ern­ment un­der which goods can be cleared by a man­u­fac­turer without charg­ing IGST meant for ex­ports by a mer­chant ex­porter against bond/lut

The chair­man urged the gov­ern­ment to in­tro­duce sim­i­lar fa­cil­ity at the ear­li­est so that the mer­chant ex­porters ex­port­ing un­der Bond/ LUT can get Igst-free goods from the man­u­fac­tur­ers.

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