Major news for taxpayers and the common man in India. The news will directly impact your pocket. As per the latest updates, the CBIC notified a hike in GST Tax Rate on Fabrics, Apparel, and Footwear. The hiked rates are expected to directly impact the major business industries in the sector of Fabrics, Apparel, and Footwear. In this article, we will read about the latest notification from CBIC notified Hike in GST tax Rate on Fabrics, Apparel, Footwear.
Implementation of New GST Rates in Upcoming Year
The Central Board of Indirect Taxes and Customs (CBIC) has announced an increase in the goods and service tax rate on different types of textiles, garments, and footwear from 5% to 12%, beginning January 1, 2022. Thus, the new and increased GST Rates on Fabrics, Apparel, and Footwear will come into effect on new year’s eve. The businesses also will have to do the GST Return Filing according to these new rates.
CBIC notified Hike in GST tax Rate on Fabrics, Apparel, Footwear
The GST Council decided to fix the inverting tax structure on footwear and textiles at its GST 45th Council Meeting, which it indicated will take effect on January 1, 2022. However, the meeting had let the effective rate adjustment be unclear on that day. However, The CBIC Notified Hike in GST Tax Rate on Fabrics, Apparel, Footwear now. The Hike on GST Tax Rate on Fabrics, Apparel, Footwear is as follows:
- From next year, the GST rate on any piece of clothing will be 12 percent, according to the new announcement. A 5% tax is now applied on sales valued up to Rs 1,000 per piece.
- Similarly, the GST rate for footwear is being hiked to 12 percent beginning next year. At the moment, 5% GST is levied on sales of up to Rs 1,000 per pair.
- Also, Woven textiles, man-made filaments stitching thread, synthesized filament yarn other than woven fabric, synthetic monofilament, and artificial filament yarn including artificial monofilament all had their GST rate raised from 5% to 12%.
- Natural fibers, pile textile materials, terry textiles, knitted or handmade, blankets and traveling rugs, bedsheets, table linen, restroom linen, and kitchen linen, curtains or indoor blinds, sacks as well as bags of a kind used in the wrapping of items, tarpaulins, awnings, and sun-blinds will all be charged at 12% GST Rate.
- Lastly, fishery nets and other manufactured net rope, synthetic fibers, pile textiles, terry fabrics, Tents; sails for boats, sailboards or landcraft, camping goods, sets, consisting of woven fabric and yarn, whether or not with accessories will also attract a GST rate of 12%.
Relaxations to bring Uniformity of Taxes
According to the announcement released on Thursday, there also has been some relaxation. The GST rates for some synthetic fibres and yarn have been reduced from 18 percent to 12 percent, bringing consistency of rates across the textiles industry and reducing inefficiencies caused by the asymmetric tax system.
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