Punjab Pradesh Beopar Mandal (Regd.) held a meeting at its main office located at Mata Rani Chowk today to oppose the Centre’s GST hike recommendations. 

Held in the presence of general secretary and member of the Central Traders Welfare Board, Sunil Mehra, and general secretary Ayush Aggarwal, the meeting saw trade leaders hightlight the recommended increase in GST rates on textiles.

Currently, fabrics priced up to Rs 1,000 are in the 5 per cent GST bracket, while fabrics above Rs 1,000 are taxed at 12 per cent. According to the new proposal, however, fabrics priced up to Rs 1,500 would be taxed at 5 per cent, fabrics priced between Rs 1500 and Rs 10,000 would be taxed at 18 per cent, and fabrics priced above Rs 10,000 would be taxed at 28 per cent. 

The leaders questioned the rationale behind considering fabric, a basic necessity, as a luxury item and imposing 28% GST on it. They pointed out that most hand-knitted sweaters would now fall under the 18% GST slab. They also highlighted that most fabric purchased during the wedding seasons also exceed Rs 10,000.

“Does this mean weddings have now become a luxury?” they questioned, further arguing that increasing GST on hand-woven fabrics to 18% would increase the costs for small and medium-scale enterprises (MSMEs).

Beopar Mandal members said considering fabric a luxury item will not help the government fill its tax coffers, adding, “Instead, it could lead to increased tax evasion, ultimately creating a deficit in government revenues. The government should aim to collect taxes from more people rather than imposing higher taxes on a smaller population.”

They urged the GST council to reject the proposal, emphasising that essential fabrics should remain taxed at 5 per cent or 12 per cent, as per necessity.

They highlighted that Punjab, particularly Ludhiana, is the hub of the textile industry in North India. “Punjab’s economic condition has already been strained in recent years due to factors like border closures by farmers and disturbed law and order. Businesses in Punjab have faced losses of at least Rs 5 lakh crore over the past 2.5 years, and the increased GST rates will further burden Punjab’s businesses and industries,” the members said.

The leaders also aimed their anger at Punjab Finance Minister Harpal Cheema, who is also a member of the GST council. “Despite being aware of the situation of hosiery in Punjab, especially in Ludhiana, he did not oppose the proposal during the council meeting,” they added.

Source: The Tribune