Surat Report Polyester yarn prices further increased upto 5-10/kg. : Weavers worried

Post GST, in two fortnights, the prices of polyester synthetic yarn have reached at a new height. The POY prices rose by 7% and yarn manufacturers have increased various deniers prices from Rs 5 to Rs 10 per kilogram in the first sale of August. The powerloom weavers of the city are worried about the hike in yarn prices. Sources said, weavers are already disturbed by 5 per cent GST on job work, 18 per cent GST on yarn and now on the other hand yarn spinners are continously increasing yarn prices.
Industry sources said, there is no rational behind increasing the yarn prices, when the companies are well aware of the fact that there is no such movement in the market. The small weavers, who are operating 12-24 powerloom machines are hugely affected by the tax on job work. Now, the increased yarn prices are further cause of worry for thousands of small-time weavers. During last month, before GST, yarn manufacturers has increased the prices of crimp, Roto and FDY deniers based yarn upto Rs. 3/kg. Now, in August first sale, they have further increased yarn prices upto Rs.10/kg. This will adversely affect the industry and the small weavers will not be able to survive.

Implement GST Tariff Act to avoid litigation : Experts demand in GST Awareness Programme

The central goverment should bring GST Tariff Act to avoid unwanted litigation in new tax regime. There are lots of questions and confusions on tax rate, input tax credit, reverse charge mechanism, deemed credit and many more in the newly implemented GST law. Lack of proper guidelines under GST system, may result in litigation. In a ”GST Awareness Programme”, organised by Surat branch of Western India Regional Council of Institute of Charterd Accounts of India and Rotary Club, experts has demanded the GST tariff law. The tariff Rules and Regulation under GST regime will ease the trade and simplify the tax structure. Chartered accountants Mukund Chauhan, Hardik Shah and Avinash Poddar has address the audience about GST on Textile, Diamond-Jewellery and Real Estate sector. They briefed the Anti-profiteering clause under GST and answered all the questions asked by the people. Surat CA branch Chairman Abhishek Mittal said that the branch will organise GST account training programme and GST software demonstration in next week.

Refund tax credit and remove 5% GST on Jobwork : Surat weavers urged to PM

The small weavers of the city are demanding removal of GST on fabrics jobwork. More than 35 textile Powerloom weaving associations of the city has sent thousands of letters to Prime Minister Narenda Modi and have urged for relief in new tax law. They have put forth demand for refund of accumulated tax credit and removing GST of 5 percent on weaving jobwork. The yarn attracts 18% GST and any jobwork done on yarn also attracts 5% GST. There will be huge loss in terms of input tax credit, which has no provision for refund under the GST law. The weavers doing jobwork will be finished. The master weavers are not giving jobwork to small scale weavers after the announcement of GST rate. The Southern Gujarat Chamber of Commerce and Industry (SGCCI) have submitted a representation to the Finance Minister and demands tax relief on synthetic yarn. The industry association said, govt. should consider 12% GST on synthetic yarn instead of 18%. The 18% GST rate on synthetic yarn will badly effect the growth and exports. It has also demended imposition of import duty on Chinese fabrics to protect the small and medium enterprises in Surat. They have also appealed the govt. to provide credit of tax paid on imported machinery under IGST.

Textile traders eyes on festival season

The textile traders of Surat are now focusing on Durgapuja, Diwali and marriage season sale. As the demand for  finished fabrics likely is rise, the wholesale businessmans are now increasing their inventories. Speciallly, printed and value added fabrics are in high demand ahead of festival season.

Earlier in July, more than 70,000 traders have started indefinite strike against the imposition of 5% GST on textiles. Thousands of textile merchants had shut their shops for two weeks to protest the new tax structure. The entire industries incurred business losses to the tune of over 5000 crore during the two weeks long strike. The traders in Surat have called off their 15 days long strike following the Centre’s assurance to look into their demand. In GST council meeting, finally, when centre denied for GST rollback on textile, traders of Surat unanimously decided to restart their businesses and also keep the fight on for simplification of GST rules.

After holding protests for long against the imposition of the GST, a large number of textile traders have started GST registration process. Over 80 per cent textile traders have shifted to GST. The purchase of finished fabrics for coming festival and marriage season has started and traders are receiving good orders from across the country.