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  Metros   Mumbai  09 Oct 2017  GST shuts lights off traders’ Diwali

GST shuts lights off traders’ Diwali

THE ASIAN AGE. | VRUSHALI PURANDARE
Published : Oct 9, 2017, 2:41 am IST
Updated : Oct 9, 2017, 6:03 am IST

Shopkeepers, wholesalers say profit margin has come down compared to previous years.

The markets usually buzzing with people on a shopping spree for Diwali festivities saw less footfall this year owing to the rise in prices of essentials. (Photo: Debasish Dey)
 The markets usually buzzing with people on a shopping spree for Diwali festivities saw less footfall this year owing to the rise in prices of essentials. (Photo: Debasish Dey)

Mumbai: Despite Diwali being just around the corner, traders, shopkeepers and wholesalers are facing a slump in business due to the implementation of the Goods and Services Tax (GST). They have claimed that their profit margin has come down this year compared to the previous years, because of five per cent of  GST being charged on garments and clothing of up to Rs 1,000 and 12 per cent beyond that. Though the GST rates have changed for a few items recently, the traders said it would not immediately reflect on Diwali sales. 

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The implementation of the GST regime has an adverse effect on festive shopping and the clothes market has taken a hit, leaving retailers unhappy. Hanif Agwan, wholesaler-retailer of Ankar Duppatta House, Dadar, said, “Due to GST the prices of dresses and materials have shot up.  The market has been in a slow down post-demonetisation and GST implementation, and I don’t have customers like I did last year.”

Irshad Ahmed of Aarohi Collections, Dadar, who supplies dresses to markets and big retailers, also said business is badly affected. Mr Ahmed said, “My store used to be loaded with customers, but that is not the case. Also, the business between us and retailers is on credit system. They take the garments and return a few if they aren’t able to sell them. Now with GST in place, we have to record and account for the garments given to the retailers and those that they return. This has increased our compliance of GST and hence the retailers are buying in small quantities.”

Tags: goods and services tax, traders, diwali festivities
Location: India, Maharashtra, Mumbai (Bombay)