Garment prices likely to rise with new tax system

20 Jul '10

2 min read

Apparel importers and owners of garment shops said that, the new government decision to push imports to a new tax system will result in increment of prices and worsen the already slow-paced market.

Last week the customs department started implementing this decision by levying a JD 1 tariff per kilogram of imported apparels or 5 percent of the value of the garments, whichever is higher.

As per a senior member of the Clothes Traders Association, earlier, customs personnel used to evaluate the value of imported products and then levied a 20 percent tax. But under the new system, the JD1 tariff each kilogram will always be on a higher side.

Under the new system, customs fees will be raised on imported apparels and this will ultimately result in a rise in prices for the end-users.

The Jordan Customs Department (JCD), Director General, Ghaleb Sarayreh, has been approached by members of the association in order to persuade him to postpone the implementation of the decision until the year-end.

The apparel market is already suffering from a drastic slowdown, and therefore, if the customs department opts for the weight formula for charging customs fees, then the price of each container will increase in the range of JD 4,000 – 5,000. Implementation of the new decision might just worsen things. The trader's demands will be sent across to the Cabinet for further discussions.

Fibre2Fashion News Desk - India

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