GST Cre­ates Chaos

Perfect Sourcing - - Cover Story -

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

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