5% GST On Textiles Will Generate Rs 11,000 Crore Revenues: Industry Experts

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5% GST On Textiles Will Generate Rs 11,000 Crore Revenues: Industry Experts

Voluntary compliance and a 5% GST rate on textile products will generate revenues of Rs 11,000 crores, which would be a three-fold increase over current revenues from the sector, a recent release by the Future Retail Group has stated. The report which gathered views of textile industry veterans stated that a low uniform GST rate would also encourage voluntary compliance and get rid of all competitive distortions arising due to the earlier differential tax regime.

“The GST provides a historic opportunity for simplifying the tax structure and promoting fibre neutrality, innovation, technology development and productive efficiency in the sector. It can play a central role in accelerating growth in the domestic market, thereby enabling India to become a significant player in the international markets,” the report stated, quoting Future Retail’s Joint Managing Director.

Industry experts are of the opinion that the GST rates on textiles are very progressive and will lead to the growth of the entire value chain. “The textile and apparel sector plays a critical role in the Indian economy. Next to food, it is the single largest component of the consumer basket. Its share of GDP and exports are 6% and 13% respectively,” the Future Retail report stated.