The Central Board of Indirect Taxes and Customs has notified a uniform items and providers tax rate of 12 per cent on materials, apparel, and footwear to appropriate the inverted responsibility construction. The modified charges will come into impact from January one, 2022.
The GST rate on apparel and footwear of any worth can be 12 per cent. Earlier the GST Rate was 5 per cent on the market worth as much as Rs 1,000 per piece within the case of apparels and per pair within the case of footwear.
While consultants hailed the transfer, a bit of the clothes trade decried it saying that solely a small group of the sector had inverted responsibility construction.
“The GST rate adjustments will make sure that the inverted responsibility construction points will come to an finish on account of the 12 per cent uniform rate throughout the worth chain,” stated M S Mani, senior director at Deloitte India.
Bipin Sapra, tax associate at EY, stated the rate adjustments within the textile sector are the primary such promised by the GST council with an purpose to rectify inverted responsibility construction and convey an environment friendly GST construction.
The GST Council in its September assembly had accredited the change in charges.