Nil GST on fabrics not feasible

Nil GST on Fabrics

Also, 28% GST for hotels with tariffs above ₹7,500: Ministry

Organised traders and unorganised sellers in the textiles sector have not been affected by the Goods and Services Tax, according to Minister for Finance, Defence and Corporate Affairs Arun Jaitley, who ruled out a decrease in the tax rate on the sector under GST.

Mr. Jaitley added that the textile manufacturers’ and traders’ main demand was for a nil tax rate on fabrics, but that this would not be feasible since a nil rate would make input tax credits unavailable. This answer in Parliament follows several strikes by textile manufacturers across the country protesting the GST treatment of the sector.

At the same time, the Finance Ministry on Tuesday clarified that hotels with a declared tariff of less than ₹7,500 per day would attract a GST of 18% and hotels with tariffs above that would attract GST of 28%, regardless of the star rating of the hotels. The clarification was in response to reports expressing doubt as to whether 5-star hotels have to pay a 28% tax regardless of tariffs.

Meanwhile, the GST Network said there was no possibility of data on the GST portal being mixed up. There is “not even the slightest possibility” of data on the portal being mixed up, with one taxpayer’s details being shown to another, GST Network chairman Navin Kumar said on Tuesday. GST Network also clarified that there were enough safeguards to prevent such a mix up from taking place.

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