Civil disobedience by handloom manufacturers against GST

September 08, 2017 - India

Indian handloom and handicraft manufacturers have joined together to oppose goods and services tax (GST) on khadi items and those made from coir, grass and jute. Workers led by Graama Seva Sangha (GSS) launched a ‘tax denial satyagraha’ in Bengaluru on September 8, urging traders not to collect and pay tax. Protesters will sell products without charging GST.

The primary demand is to have zero-tax slab for handmade products. The All-India Federation of Handloom Organisations (AIFHO) also plans to launch a similar civil disobedience movement in Hyderabad on September 9, the day on which the GST Council is scheduled to meet there. The movement has the backing of consumers, activist and eminent artistes, according to media reports.

Textiles, which were exempted earlier, now attract tax. Yarn and fabric are taxed at 5 per cent, readymade garments priced below Rs 1,000 at 5 per cent, and those above Rs 1,000 at 12 per cent. Tax is levied on khadi and handloom products as well.

The problem is compounded as the National Handloom Development Corporation (NHDC) has refused to supply cotton yarn to handloom societies without GST registration. Most weavers in Andhra Pradesh and Telangana regions work with cotton that is bought from NHDC.

The 5 per cent GST on cotton yarn has proved to be a nightmare for weavers, according to AIFHO convenor B Syama Sundari, who works with Dastkar Andhra, an NGO that provides policy and advocacy support.

As the handlooms market is very price-sensitive, Sundari said about 44 lakh weaver families across the country are affected. The handloom industry is the worst-hit sector by GST, said JK Suresh, member of Bengaluru-based people’s knowledge movement Loka Vidya Vedike.

The GST regime did away with the 18.5 per cent anti-dumping duty on imported silk. As a result, silk imported from China has become much cheaper compared to locally-produced silk, says Prasanna, a theatre person and a GSS mentor.

To draw further attention to the issue, the GSS plans to organise a 120-km foot march on September 24 from Junjappana Gudde in Tumkur district in Karnataka and reach Kasturba Gandhi Ashram at Arisikere on October 2. (DS)