Edited by Deepali Verma
Right before the central government’s interim budget, the Apparel Export Promotion Council (AEPC) has sought for the uniformity in Goods and Services Tax for the entire value chain.
Making a submission to the central government, it made a request to put in place a uniform GST of 5 per cent across the entire man-made fibres (MMF) value chain, consisting largely of fibre, yarn and fabric.
The MMF GST rate on fibre presently stands at 18 per cent, yarn 12 per cent, and fabric 5 per cent. The export promotion council is of the belief that the results in unutilized input credit and consequent liquidity issues for MSME units.
Further, it has put in a request to the government to increase the interest equalisation rates falling under the scheme to 5 per cent for all the apparel exporters. “This is bound to increase the apparel industry’s competitiveness in the international market and enable them to avail necessary working capital,” the council said.
The interest equalisation facilitates the exporters from identified sectors and all MSME manufacturer exporters to make use of pre and post-shipment Rupee export credit at competitive rates.
As of now, the rates for Manufacturers and Merchant Exporters exporting products listed in the 410 tariff lines and MSME exporters of all tariff lines stands at 2 per cent and 3 per cent, respectively.
Other recommendations made requests for tax concessions to apparel manufacturers adopting ESG and other international quality standards and compliances. It additionally sought budgetary support for branding and marketing of Made in India products.
The Budget session of Parliament, which happens to be the last session before the general elections expected in April-May, will commence on January 31 and is likely to continue till February 9, as per the sources.
Union Finance Minister Nirmala Sitharaman is set to present the interim budget on February 1. The President Droupadi Murmu’s address will mark the opening of the session to the joint sitting of the two Houses of Parliament. The interim budget generally takes care of the fiscal needs of the intervening period till a government is formed after the Lok Sabha polls.
