Kerala textile traders urge govt to withdraw turnover tax

21 Feb '14

1 min read

Textile and garment traders in the southern Indian state of Kerala have urged the state government to withdraw the proposed turnover tax on textiles, reports The Hindu Business Line.

In the State Budget for 2014-15, the Government of Kerala has proposed levying of two percent tax on textile wholesalers and retailers with turnover of more than Rs. 10 million per annum, and thereby mobilize Rs. 1 billion in additional revenue for the government.

At a meeting in Thrissur, the Kerala Textile and Garments Dealers Welfare Association has decided to stop buying textiles and clothing items from other states from April 1, 2014, if the government does not withdraw the tax as proposed in the State Budget for 2014-15.

However, the official declaration of stopping purchases from other states would be made during the next meeting of the State Council of the Association, by end of next month.

Kerala depends on other states for meeting its demand for textiles and clothing, and the introduction of turnover tax would make the products cheaper in the neighbouring states compared to Kerala. As a result, consumers may prefer to buy textiles and readymade garments from the neighbouring states, at the expense of local traders, the Association said.

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