GST paradox: Charkha spared, but spares taxed

GST paradox: Charkha spared, but spares taxed

AHMEDABAD: After implementation of the Goods and Services Tax (GST), the ‘charkha’, the strongest symbol of India’s freedom struggle, has been exempted from tax, but spare parts have become taxable — thus increasing costs for those who still engage in the traditional spinning of yarn by hand.

“In most cases, charkhas require the kind of repairs which involve changing of parts. In addition to the cost of the spare part, applicable GST has to be paid by the customers. This wasn’t the case under the Value Added Tax (VAT) regime,” said Chandrakant Patel, of Udyog Bharati in Gondal, a manufacturer and supplier of charkhas.

Explaining further, Kalyansinh Rathod, managing director, Gujarat Khadi Gramodyog Mandal, Gandhi Ashram, said, “There are various types of charkhas made of either metal sheets and parts or wood, both of which attract GST. That apart, smaller spare parts such as spindle, gears, top arm and roll body, among others, also attract either 12% or 18% GST. This has led to an increase in the cost of a charkha.”

Ambar charkha – which is most widely sold – used to cost around Rs 13,000. Now its cost has gone up to Rs 15,000. Costs of ‘Book charkha’ and ‘Box charkha’ have also gone up significantly.

 Ambar charkhas are usually the most in demand, especially in cottage industries manufacturing khadi which provide livelihood to rural women. “Charkhas are usually procured by companies. However, the women weavers have to bear costs of repair or replacement of parts. These repair costs have gone up by 18-20% as spares now attract GST,” explained Rathod.
No exemption has been provided for charkha spare parts by the GST Council in its recent meeting. Manufacturers and suppliers are certified and approved by the Khadi Village Industries Commission (KVIC), through which, these firms get their orders for supply across the country. Some 3,000 to 4,000 charkhas are manufactured at a given such unit annually.
Source: https://timesofindia.indiatimes.com/city/ahmedabad/gst-paradox-charkha-spared-but-spares-taxed/articleshow/64006555.cms
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