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Cotton, MMF should have equal taxation system – Textile Min

22
Jul '10
Creating a strong case for equality in tax between cotton and man-made fibre, the Textile Ministry will soon be presenting the draft national fibre policy to the Cabinet, probably next month, informed a senior official from the Textile Ministry.

In the draft policy, the Textile Ministry has displayed concerns for the exorbitant disparity in taxes between man-made fibres (MMF) and cotton.

For instance, no excise duty is levied on cotton, whereas, MMF attracts 8 percent duty. In fact cotton textiles have an optional duty of four percent. Similar, instances of disparities are also visible further in the value-chain, averred the Textile Ministry.

The draft policy also mentions that, if the excise duties on MMF and MMF textiles are cut down then they will have a positive impact on the growth of MMF usage.

Further more, the Textile Ministry informed that, going forward, demands are likely to be on the higher side for man-made fibre based textiles and therefore, special attention needs to be given to these fibres, in order to increase their usage and production in India.

In the $63 billion textiles industry of India, MMF totals for 41 percent of fibre consumption, whereas cotton accounts for 51 percent. When compared, the ratio of MMF to cotton usage internationally is, 60:40.

Fibre2Fashion News Desk - India


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