GST on textile jobs reduced from 18 per cent to 5 per cent
The textile sector has seen massive protests against the GST in many states, including Gujarat.
New Delhi: The GST Council on Saturday reduced tax on all job works in the textile sector, including stitching and embroidery to 5 per cent from 18 per cent, and reduced tax on parts used exclusively for tractors from 28 per cent to 18 per cent.
The textile sector has seen massive protests against the GST in many states, including Gujarat. A job work means a manufacturer outsourcing works like embroidery to others as per market demand.
The Council reduced the GST on work contracts of state and the Central government from 18 per cent to 12 per cent, and also work contracts for post harvest storage infrastructure for agriculture produce. It also exempted services and goods related to junior Fifa World Cup to be held in India from the GST.
The GST Council also finalised the e-way bill that mandates pre-registration of all goods worth over Rs 50,000 before they are moved for sale beyond 10km. It is tentatively set for rollout from October 1.
The GST-exempted goods have been kept out of the purview of e-way bill — a minor relaxation from draft rules, which required for all goods to be pre-registered under the e-way bill provision. The permits thus issued would be valid for one day for the movement of goods for 100 km and in same proportion for following days.
After the meeting, finance minister Arun Jaitley said a large number of industries have not passed on the benefit of input tax credit under the GST to consumers and made a appeal to businesses to reduce prices in line with fall in taxes.
The government will launch a consumer education drive and will also set up screening committee at the Centre and state in 15 days to look at the cases where the provision of anti-profiteering could be used.
“The market mechanism should compel that they give benefit of input credit,” said Mr Jaitley, hoping that there would be “minimal” use of anti-profiteering provision and the provision should itself act as a deterrent.
The GST was kept at 5 per cent without any input tax credit. It has been decided that for small housekeeping services like plumbing, it will be aggregator, who will be liable to deposit GST. The Council will meet next on September 9 in Hyderabad.