Industry divided over 12% uniform GST rate on apparel and footwear

Large manufacturers and retailers are mostly happy as move addresses issue of inverted duty structure; some others see it as hurting small units, along with retailers and customers

The Central Board of Indirect Taxes and Customs notified a uniform goods and services tax (GST) rate of 12 per cent on fabrics, apparel, and footwear to correct the inverted duty structure, evoking mixed response from companies.

Large manufacturers and retailers are mostly happy with the move since the 12 per cent uniform tax slab addresses concerns about the inverted duty structure. This was an area of concern since some input components came under a higher tax slab.

The changed GST rates for apparel and footwear will come into effect on January 1, 2022.

“This is a welcome move by