Home / Knowledge / News / Apparel/Garments / Hike in VAT rates. Retailers in dilemma
Hike in VAT rates. Retailers in dilemma
02
Jul '10
Textile and apparel retailers in Spain are in a dilemma, on whether to pass on the increase in VAT rates to the consumer or absorb them, which will cut their margins. VAT will be increased from 16 to 18 percent in Spain from next Thursday.

However, most retailers are planning to absorb the hike, rather than pass it on to the consumers, considering that, as it is, consumer spending is low and an ultimate increase in prices at this juncture could send the wrong signals.

The 18 percent slab will be the highest in history ever since it was introduced, way back in 1986. At the end of deliberations to understand the impact, if at all the hike was passed on to the consumers, clothing retailers have decided not to hike their prices.

According to Angel Asensio, President of the Spanish Intertextile (CIE) and the Federation of Apparel Industries (FEDECON) said that the VAT hike will impact the entire textile and clothing value-chain of production and logistics across the sector.

Analysts are of the opinion that, while the Government's objective is to increase revenues and reduce the deficit, this measure could delay economic recovery. The Govt plans to mop up around €5,150 million in the first 12 months from the hike.

According to experts, big companies and retailers will not be affected as much by the hike, since they have economies of scale, but the axe will fall on the small and medium scale industries, which will not be able to absorb the hike in VAT rates.

Fibre2fashion News Desk - India


Must ReadView All

Uzbekistan wants joint ventures with Hungarian textile firms

Textiles | On 20th Feb 2018

Uzbekistan wants joint ventures with Hungarian textile firms

Uzbekistan has offered Hungary to create joint ventures in the two...

Vietnam’s textile & garment exports up 10.68% in 2017

Textiles | On 20th Feb 2018

Vietnam’s textile & garment exports up 10.68% in 2017

Vietnam came very close to achieving its 2017 textile and garment...

From left: Tania Polonnowita Wettimuny, MD, Hellmann Sri Lanka; Bart de Vries, Global COO Air & Sea Hellmann; Deshamanya Mahesh Amalean, Chairman, MAS Holdings; & Shirendra Lawrence, COO, MAS Holdings

Textiles | On 20th Feb 2018

Hellmann and MAS form joint venture HMSC

Hellmann Worldwide Logistics and MAS Holdings have formed Hellmann...

Interviews View All

Angelina Francesca Cheang
MY ANJE

'Consumers in the age-group 21 to 38 are driving the activewear trend'

Abhishek Ganguly
Puma India

‘As a brand, Puma is always looking for new and innovative ways to inspire ...

Top executives
Textile industry, India

Such fairs are a must for industry to showcase new innovations

Hardik Sanghvi

Idealin Fogging Systems has been engaged in designing and manufacturing...

Harmeet Singh

New Delhi-based Jogindra Industries Private Limited provides an assortment ...

Suresh P Bagrecha

Komal Texfab, founded in 1981, is into manufacturing of knitted fabrics,...

Johan Berlin
InvestKonsult Sweden AB

Investkonsult Sweden AB has been buying and selling second-hand textile...

Larry L Kinn
Suominen Corporation

Larry L Kinn, Senior Vice President - Operations Americas of Suominen...

Eric Scholler
Groz-Beckert

The Indian market has huge potential in technical textiles, and by far,...

Prathyusha Garimella
Prathyusha Garimella

Hyderabad-based designer <b>Prathyusha Garimella</b> is known for blending ...

Anisha Chaudhari
Threads & Shirts

Threads &amp; Shirts is a freshly-tailored concept providing men/women a...

Silvia Venturini Fendi
Fendi s.r.l

"Yes, my confidence and positive attitude are my strengths and should be...

Press Release

Press Release

Letter to Editor

Letter to Editor

RSS Feed

RSS Feed

Submit your press release on


editorial@fibre2fashion.com

Letter To Editor






(Max. 8000 char.)

Search Companies





SEARCH

February 2018

Subscribe today and get the latest update on Textiles, Fashion, Apparel and so on.

news category


Related Categories:

Planning to Take the Leap towards
Sustainability?

Do you see sustainability as a route to business growth?

Yes No

Do you think the sustainability space has the needed tools and resources available for a business to lead change?

Yes No

Active Poll

Do you see sustainability as a route to business growth?

Yes
70.6%
No
12.7%
Skip
16.7%

Total Votes: 102

Do you think adopting a sustainable approach will be a profitable move for your business?

Yes No

Active Poll

Do you think the sustainability space has the needed tools and resources available for a business to lead change?

Yes
63.7%
No
29.4%
Skip
6.9%

Total Votes: 102

Do you want the world to know about your sustainability journey and your business’ environmental footprint?

Yes No

Active Poll

Do you think adopting a sustainable approach will be a profitable move for your business?

Yes
88.2%
No
8.8%
Skip
2.9%

Total Votes: 102

Thanks for your valuable feedback. Claim your free latest sustainability e-book.

Active Poll

Do you want the world to know about your sustainability journey and your business’ environmental footprint?

Yes
83.3%
No
7.8%
Skip
8.8%

Total Votes: 102


E-News Insight
Subscribe Today and Get the
Latest News Update in Your Mail Box.
Advanced Search