GST Coun­cil cuts Rates for Leather Goods and Footwear

Shoes & Accessories - - The Month That Was -

Dur­ing the 25th GST Coun­cil meet­ing held on Jan­uary 18, 2018 the gov­ern­ment has an­nounced re­duc­tion of job work ser­vices rate for man­u­fac­ture of leather goods and footwear from 18% to 5%. It also an­nounced the re­duc­tion of GST on Com­mon Ef­flu­ent Treat­ment Plants ser­vices of treat­ment of ef­flu­ents, from 18% to 12%. The rates of job work and CETP ser­vices will come into ef­fect from Jan­uary 25, 2018.

Ad­di­tion­ally, it has an­nounced ex­emp­tions for ser­vice by way of trans­porta­tion of goods from In­dia to a place out­side In­dia by air; and for ser­vice by way of trans­porta­tion of goods from In­dia to a place out­side In­dia by sea and pro­vide that value of such ser­vice may be ex­cluded from the value of ex­empted ser­vices for the pur­pose of re­ver­sal of ITC. The above ex­emp­tions on trans­porta­tion of goods will be granted with a sun­set clause upto 30th Septem­ber, 2018.

Men­tion must be made that Coun­cil for Leather Ex­ports (CLE) has been con­tin­u­ously rep­re­sent­ing to the Gov­ern­ment at var­i­ous fo­rums for re­duc­tion of GST rates of items re­lated to the leather and footwear in­dus­try. Ac­cord­ing to Mukhtarul Amin, Chair­man CLE, “This has been done so with the ob­jec­tive to re­duce fi­nan­cial strain on the in­dus­try and to en­sure sus­tain­able growth. As re­quested by CLE, the GST Coun­cil had ear­lier re­duced the GST rates on fin­ished leather from 12% to 5% and for leather goods/leather gar­ments/sad­dlery items etc., and also leather chem­i­cals from 28% to 18%.”

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