Indian Textile Sector Pushes for Single GST Rate, Citing Everyday Struggles
From Surat’s weaving hubs to small fabric shops in Ludhiana, there’s a growing single GST rate demand.
For India’s massive textile sector — which touches everything from raw cotton to finished clothes — the current multi-slab GST system is becoming too much to handle.
“Today it’s 5%, tomorrow 12% — who knows what applies to what?” said Dinesh Lal, a cloth shop owner in Varanasi. “We spend more time checking tax rates than selling.”
Small Businesses Struggle Amid Single GST Rate Demand Confusion
India’s textile products are taxed differently: some raw materials fall under 5% GST, synthetic yarns often face 12%, and other finished goods go as high as 18%.
For big factories, managing this may be routine. But for street-side sellers, small weavers, and even tailors, it creates chaos.
“I’m not a chartered accountant,” said Pushpa Devi, a tailor in Jaipur. “I stitch clothes. But now I must learn GST to survive?”
Even Filing Returns is a Headache
There are nearly 4.5 crore people who earn their livelihood through this sector — many of them in unorganised setups.
Their biggest problem? Compliance.
“Every month I run behind my tax guy just to file the return properly,” said Yash Solanki, who operates a small dyeing unit in Gujarat. “If we make one mistake, penalties come. Why should we suffer for a broken system?”
And then there’s the refund problem. Many traders complain that GST refunds take months, especially when input and output taxes don’t match.
Single GST Rate Demand Could Level the Playing Field
Industry groups say the government can easily fix this with a single GST rate — ideally between 5% and 8% — for the entire textile chain.
“Same tax for yarn, fabric, garments — that’s what we need,” said Sunil Sharma, a wholesaler in Delhi’s Gandhi Nagar market. “Right now, every item has a different tax — even if they are used together!”
Exporters too are worried. Complex GST rules mean Indian goods lose edge to countries with simpler tax structures.
No Clear Word Yet from the Government
While the textile industry has submitted its concerns to the Finance Ministry, there’s no official response yet. Some believe the next GST Council Meeting might discuss it.
“We hope they listen. We’re not asking for a free ride,” said Farzana Sheikh, a fabric seller in Hyderabad. “Just make things fair and simple.”
From metros to small towns, the frustration is loud and clear. One tax. That’s all they ask for.
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