GST impact: Blue Star reviews expansion plan

The company re-evaluating the plans owing to change in tax benefits post GST implementation

Air conditioner major Blue Star said it was re-evaluating plan to set up a manufacturing facility in Jammu, in the wake of change of tax benefits after the goods and services tax (GST).

The company is expecting a report from KPMG on whether it would be a prudent investment in the post-GST regime. A decision would be taken in November, said B Thiagarajan, joint managing director, Blue Star. The decision will also have an impact on its plan to set up a facility in Sri City, an integrated business city in Andhra Pradesh.

Speaking to the reporters after announcing the company’s plans on expanding residential water purifier business, he said, “We had to put the plan on hold because the plant makes sense only in case the erstwhile central value added tax benefit is fully available in the GST regime.”

The company has earlier announced that it would be launching two facilities, one in Samba and another in Sri City, which would together see an investment of around Rs 215 crore over three-four years. The land has been acquired in both the locations.