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Fabric traders stage strike against 5% GST levy

So far, around a million small and medium size units were paying no duty

Dilip Kumar Jha  |  Mumbai 

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Traders at a day-long strike against the goods and services tax in Ahmedabad on Thursday. (Photo: Reuters)

traders staged a nationwide token strike on Thursday, protesting the decision to bring the item under the (GST) net. 

A five per cent rate has been levied — around a million small and medium size units were paying no duty so far. Even if these units wish to evade the tax, garment makers would be a check — to claim input credit from the government, garment manufacturers would need compliance papers from makers and traders.

“We had a firm belief that items which at present are not taxed (either excise or value-added tax) will continue to enjoy exemption. Textiles have been classified under essential commodity/goods of special importance. The industry and trade employs 100 million people directly or indirectly. Most of them are in the unorganised sector or self-employed. If is imposed on fabrics, the backbone of the trade will be broken,” goes a representation by the Traders’ Association (TTA), a body of manufacturers. There are 2.7 million powerlooms in the country, in the medium or small scale sector.  Association (TTA), a body of manufacturers.
 
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Members of merchant association protest against as clothes market remain shut during a bandh call by Jharkhand wholesale clothes traders association in Ranchi on Thursday. (Photo: PTI)

A unit here has between four and 16 looms and the sector is the second largest employer, after agriculture. “The entire business will be ruined if the is not withdrawn. Today, only yarn attracts central excise duty in the entire value chain. Since the government has already enhanced the current excise duty from 12 per cent to 18 per cent on man-made yarn, there will be no revenue loss if is withdrawn on fabric,” pleaded Raichand Binayaka, convenor, TTA.

GST, goods and services tax, textile merchants, Clothes market, bandh, national strike, Chandni Chowk, wholesale clothes, clothes traders, clothes traders association, New Delhi, textile shops
A clothes market at Chadni Chowk remains shut during a bandh called against the in New Delhi on Thursday. (Photo: PTI)

The next meeting of the Council is scheduled this Sunday. Traders warned of an indefinite strike if the government does not withdraw the five per cent on

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