New Delhi: The Goods and Services Tax (GST) on textiles and footwear has been hiked from 5 percent to 12 percent. This was announced by the Central Board of Indirect Taxes and Customs (CBIC). With this, the prices of clothes will go up from January. At present, the tax on textiles up to Rs 1,000 was five percent. The GST on shoes, regardless of price, has also been increased from five to 12 percent.
The GST Council meeting last September decided to revise the tariff on textiles and footwear from January. Although the GST rate was not increased, garment prices were expected to rise by 15-20 percent. Eighty percent of the market is made up of garments priced below Rs 1,000. According to officials at the Clothing Manufacturers Association of India, the decision will affect the textile sector as prices of yarn, packing and freight go up.
