GST Creates Chaos
Ever since GST was implemented in the garment industry there has been a lot of chaos. While the first months went into the confusion on how much duties and taxes have to be paid once GST is implemented, the later months saw a lot of agitation and strikes across the textile and apparel hubs of India against the GST structure. In fact, Surat, Tirupur, Ahmedabad and Ludhiana remained the worst affected areas. As a result, India’s apparel exports have seen a huge drop. As per the data released by Commerce Ministry, apparel exports fell by 40.75 per cent in October 2017 to Rs 5,398.08 cr as compared to exports of Rs 9,110.75 cr in same month of the previous year. This includes garments of all textiles, according to the quick estimates of India’s foreign trade during the month, released by the ministry of commerce and industry.
After the implementation of GST from 1st July 2017, apparel exporters are required to pay Integrated Goods and Service Tax (IGST)UP to 18 per cent on assessable value plus Basic Custom Duty while clearing shipments of capital goods under Export Programme Grant Scheme. The incidence of a very high