The Council did decide on the GST rate for a variety of textile machinery, all of which have been placed under the 18 per cent slab. However, it is not likely to make much of a difference to machinery prices as the tax on machinery currently amounts to 17.5 per cent.
"As per the announced GST rate, there is no drastic difference in the existing purchase and sales of machineries. Earlier also, the rate for machinery was 12.5 per cent with 5 per cent VAT which totalled to 17.5 per cent. With 18 per cent GST on machinery, there is neither loss nor gain. However, it is too early to say anything as we are yet to have the rates for services and textiles," CB Chandrashekar, CFO, Lakshmi Machine Works Limited, told Fibre2Fashion.
As for the home textile products wholly made of quilted textile materials, they will attract 12 per cent tax under the new tax regime.
It has also been announced that e-commerce players will need to deduct 1 per cent tax at source before paying suppliers, a move that is unlikely to directly affect consumers.
"We believe GST is good for the e-commerce industry as it would eliminate hurdles in inter-state delivery and subsume the entry tax introduced on e-commerce shipments by some states. We are studying the developments very closely and our priority is to enable our seller ecosystem to be geared up for compliance with GST regulations. As always we will work customer backwards to ensure they are not inconvenienced," an Amazon spokesperson told F2F.
The Confederation of All India Traders (CAIT) has suggested that the first nine months from roll out of GST on July 1 can be considered as a trial period. It has urged the government that punitive actions should not be taken against businesses for making procedural mistakes in order to help them get familiarised with the new taxation regime. (KD)
Fibre2Fashion News Desk – India
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