>>
Home / Knowledge / News / Textiles / Govt should remove VAT on handloom & handicrafts, ASSOCHAM

Govt should remove VAT on handloom & handicrafts, ASSOCHAM

15
Oct '09
Mr. D S Rawat, Secretary General, ASSOCHAM
The Associated Chambers of Commerce and Industry of India (ASSOCHAM) has urged the Finance Ministry and the Empowered Committee on VAT to remove the Value Added Tax (VAT) on products of fashion, especially with more than 50% handloom and handicrafts input to make them competitive in the global market.

In a representation sent to Finance Ministry and Empowered Committee on VAT by ASSOCHAM Secretary General, Mr. D S Rawat, it is stated that Indian fashion industry is at budding stage and accounts for barely 0.3% of international industry's networth, which may further come down in the absence of necessary government support.

Currently, fashion products that fall under VAT net ranging between 8-12% and make them costlier and thus dilute their competitiveness, the ASSOCHAM has thus emphasized need for removal of VAT on fashion products, having more than 50% handloom and handicraft input.

The Chamber has argued that the fashion design industry in India is extremely fragmented and unorganized even then it is expected to touch over Rs.800 crore of turnover in next 2-3 years. The present estimated level of fashion design industry is around Rs.300 crores.

Mr. Rawat said that the current market scenario and market dynamics of the designer wear industry in India finds it difficult to build concept and implementation of roadmap for setting up a successful, self-sustaining fashion hubs in India and therefore, the government support to it is the need of hour especially in the form of tax incentives and also need funding assistance.

The ASSOCHAM has also come out with a roadmap for creation of fashion hub which can be possible by implementation of roadmap to be jointly prepared by industry and government with strategic approach for short, medium and long-term.

The ASSOCHAM has recommended that the suggested fashion hubs could be set up provided India looks at successful models of setting up and running fashion hubs in different countries such as USA, France, South Africa, also in emerging markets like Dubai.

Relevant elements could be taken to develop the fashion hub in areas with maximum participation from the government since there are many examples where the government is promoting fashion industry such as France, Japan, Hongkong, USA etc.

In view of ASSOCHAM, the suggested fashion hubs should be set up as an special purpose vehicle (SPV) model under Companies Act.The land should be identified and purchased by the SPV before government puts it in its contribution as equity or grant.

The government equity and grant could be limited to 20% of project costs including facilities like health, spa, hotel and guest fitness centres, subject to a maximum of Rs.20 crore.

Government equity should be released in 4 equal instalments subject to equal contribution having been made by SPV after purchase of land, said Mr. Rawat.

The Associated Chambers of Commerce and Industry of India


Must ReadView All

Pic: Shutterstock

Textiles | On 17th Jan 2022

China’s GDP increases by 8.1% in 2021

The GDP of China was 114,367 billion yuan in 2021, an increase of 8.1 ...

Pic: Shutterstock

Textiles | On 17th Jan 2022

EU-UK bilateral trade of textiles witness major drop: EURATEX

The imports and exports of textiles between the EU and UK have...

Pic: Shutterstock

Textiles | On 17th Jan 2022

Canada-Vietnam sign MoU for joint economic committee

Canada and Vietnam recently signed a memorandum of understanding...

Interviews View All

Textile Industry, Head honchos

Textile Industry
Head honchos

Delay in adopting water sustainability both financially & environmentally...

Gaurav Davda, Jindal Worldwide Ltd

Gaurav Davda
Jindal Worldwide Ltd

Indian MMF sector to become globally competitive

India-EU Summit, Representatives

India-EU Summit
Representatives

India-EU FTA will provide EU with better access to a huge & rapidly...

Juan Pares Boj,

Juan Pares Boj

Textil Santanderina is a cutting-edge textile company located in...

Akram Tariq Khan,

Akram Tariq Khan

E-commerce brand YourLibaas meaning "garment or attire" in Udru, was...

Kishina Daruka and Mishika Daruka,

Kishina Daruka and Mishika Daruka

Headquartered in Kolkata, India, sustainable clothing brand Ora was...

Sachin Pendharkar, Dieffenbacher India Pvt Ltd

Sachin Pendharkar
Dieffenbacher India Pvt Ltd

Germany-based Dieffenbacher Group is a producer of high-quality composites ...

Serkan Gogus, Mogul Nonwovens

Serkan Gogus
Mogul Nonwovens

Mogul is a global player ranked among the top 40 nonwoven producers in the ...

Suresh Patel, Non Woven Federation of India

Suresh Patel
Non Woven Federation of India

The Non Woven Federation of India (NWFI), representing the regional...

Shalini Sharma & Shweta Pundir Sharma, Six Yard Story

Shalini Sharma & Shweta Pundir Sharma
Six Yard Story

Six Yard Story is a premium artisanal brand with a focus to bring handloom ...

Reynu Taandon, Label Reynu Taandon + Nikhita

Reynu Taandon
Label Reynu Taandon + Nikhita

Renowned womenswear designer <b>Reynu Taandon </b>has been serving the...

Rocky Star, Label - Rocky Star

Rocky Star
Label - Rocky Star

<b>Rocky Star,</b> an Indian designer known for his inspiration from the...

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

Leave your Comments

ESTEEMED CLIENTS

SYNERGIES HONG KONG LIMITED
Esprit Europe Services GmbH
Brandix Lanka Limited
Tchibo GmbH
THE BOMBAY DYEING ;& MFG.CO. LTD
Rosset ;& Cia Limited
Truetzschler India Private Limited
Recron Polyester from Reliance Industries Limited
KAS Direct Sourcing
Maceton Limited
Permoda(Koaj/Armi/Pronto/Bkul)
IKEA of Sweden AB
Etam Group Strategy Hong Kong Limited
OVS Hong Kong Sourcing Ltd.
Chico’ FAS
Helly Hansen Far East Ltd
Grasim Industries Limited
LC Waikiki

January 2022

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


Advanced Search