CHENNAI - Dr A. Sakthivel, Southern Regional Chairman, Federation of Indian Export Organisations (FIEO), has, in a communication to the Union Finance Minister, made a strong case for a 5 per cent GST rate for job works in the garment sector.
Dr Sakthivel said the industry takes this opportunity to compliment you for GST rate of 5 per cent for certain services, as approved by the GST Council in its meeting held on June 11.
The services by way of job work in relation to textile yarns [other than man-made fibre (filament)] as textile fabrics have been brought to GST rate of 5 per cent with full ITC as against 18 per cent announced earlier.
There are a number of activities which are undertaken by the job workers in garment making which are left out. Some of the important services are as follows: Cutting/Garmenting, Embroidery, Finishing, Washing/Pressing, Packing, Fabric processing like bleaching, dyeing, printing, knitting
The job work in cotton, blend, MMF should be included under 5 per cent GST uniformly for yarn, fabric, garments and made-ups, whether woven or knitted, irrespective of fibre base.
The labour-intensive sector of apparel manufacturing heavily depends on job work. Therefore, the recommendations of the Council be accepted.