SGCCI Seeks 5% Uniform GST on Entire Man-Made Fibre Textile Value Chain

Surat | Gujarat — The Southern Gujarat Chamber of Commerce and Industry (SGCCI) has represented Union Minister of Jal Shakti CR Paatil, requesting him to put forth their demand of bringing the entire man-made fibre (MMF) textile value chain under a uniform GST rate of 5%. 

A delegation led by SGCCI vice-president Ashok Jirawala and former SGCCI president Ashish Gujarati met Union Minister for Jal Shakti, CR Paatil in New Delhi and appraised him about the ground realities in the MMF textile value change after the MMF yarn GST rates were reduced from 12% to 5%. 

The SGCCI delegation had made a presentation requesting to bring the entire manmade fibre textile value chain from various chemicals like para xylene, caprolactam, MEG, PTA to cloth under a uniform GST rate of 5%.

SGCCI president  Nikhil Madrasi said that the presentation made by the delegation stated that the inverted duty structure at the yarn manufacturing stage has become more severe with the current reduction in the rate on MMF yarn from 12% to 5%, which will create a huge hurdle in input credit. 

Due to this inversion, MMF spinners will not be able to avail input credit on capital goods during their projects. As the sector is expecting an investment of up to Rs 24,000 crore in the next 3-4 years, this huge input credit constraint on capital goods will make them lose their competitiveness and ultimately force them to shift the cost burden to the next value chain components.

The SGCCI delegation requested the Union Minister to  convey this representation on behalf of the Chamber to the Finance Minister, Nirmala Sitharaman and the Union Minister for Chemicals and Fertilizers, J.P. Nadda.

SGCCI vice-president  Ashok Jirawala said that CR Paatil  listened to the representation made by them very calmly and assured to convey this representation to the concerned departments.