Around 2,000 knitwear and readymade garment units in Tiruppur, India partook in a one-day strike on July 21 to protest the GST Council’s decision to place apparel job work under 18 per cent slab in Goods and Services Tax (GST). GST was rolled out across India from July 1, in place of 17 different Central and state taxes that existed prior.
Knitting dyeing and compacting job work attracts only five per cent GST, other job work like printing, embroidery, button fixing, checking, ironing and packing attract 18 per cent GST. Such a high GST will put the sector under financial stress, which could render people unemployed.
The Tiruppur Export Knit Printers Association strongly believes that the imposition of 18 per cent GST creates is a crippling burden on the apparel job work units which run with capital investments of Rs 50,000 to Rs 50 lakh a month and on a 90-day credit format.