Yarn spinners not passing on reduced GST benefits say weavers

  • | Saturday | 8th September, 2018

Section 17(1) of the GST Act mentions that any benefit in tax rate has to be passed on to the recipient of the goods or services.”Power loom weavers have stated that the yarn spinners have indulged in anti-profiteering activities and that the GST Council and the state GST commissioner must immediately intervene for the overall benefit of power loom weavers. They have stopped the purchase of yarn and still the spinners have gone on the spree of increasing the prices.”Leader of power loom sector Mayur Golwala said, “The reduction of GST rate from 18 per cent to 12 per cent on yarn has not been passed on to the weavers by yarn spinners. SURAT: The power loom sector has petitioned the Goods and Service Tax (GST) Council and the Gujarat state GST commissioner against yarn spinners for not passing on the benefits of the reduced GST rate from 18 per cent to 12 per cent on the supply of yarn to power loom weavers The Federation of Gujarat Weavers Association (FOSTTA) in its petition stated that small and marginal weavers have been hit hard due to the increase in yarn prices in the last couple of months.According to FOGWA, the yarn spinners have increased yarn prices in all the yarn deniers by Rs 25 per kilogram in the month of August. Actually, the price hike is artificial and it has highly impacted the profits of the small and marginal players in the power loom sector.”Jirawala added, “The production of unfinished fabric has gone down by almost 40 per cent as the small and marginal players are making huge losses. Again, the yarn prices in various deniers were hiked by Rs 5-Rs7 per kilogram on September 1 and by Rs 8 per kg on September 7, taking the overall price rise at Rs 40 per kilogram.In order to sustain their profits, weavers have been compelled to increase the price of unfinished fabrics by Rs 3 per metre, which will ultimately increase the prices of finished fabrics.President of FOGWA, Ashok Jirawala said, “The yarn spinners have attributed the hike in yarn prices to the weak rupee and the international crude oil prices.

SURAT: The power loom sector has petitioned the Goods and Service Tax (GST) Council and the Gujarat state GST commissioner against yarn spinners for not passing on the benefits of the reduced GST rate from 18 per cent to 12 per cent on the supply of yarn to power loom weavers The Federation of Gujarat Weavers Association (FOSTTA) in its petition stated that small and marginal weavers have been hit hard due to the increase in yarn prices in the last couple of months.According to FOGWA, the yarn spinners have increased yarn prices in all the yarn deniers by Rs 25 per kilogram in the month of August. Again, the yarn prices in various deniers were hiked by Rs 5-Rs7 per kilogram on September 1 and by Rs 8 per kg on September 7, taking the overall price rise at Rs 40 per kilogram.In order to sustain their profits, weavers have been compelled to increase the price of unfinished fabrics by Rs 3 per metre, which will ultimately increase the prices of finished fabrics.President of FOGWA, Ashok Jirawala said, “The yarn spinners have attributed the hike in yarn prices to the weak rupee and the international crude oil prices. Actually, the price hike is artificial and it has highly impacted the profits of the small and marginal players in the power loom sector.”Jirawala added, “The production of unfinished fabric has gone down by almost 40 per cent as the small and marginal players are making huge losses. They have stopped the purchase of yarn and still the spinners have gone on the spree of increasing the prices.”Leader of power loom sector Mayur Golwala said, “The reduction of GST rate from 18 per cent to 12 per cent on yarn has not been passed on to the weavers by yarn spinners. Section 17(1) of the GST Act mentions that any benefit in tax rate has to be passed on to the recipient of the goods or services.”Power loom weavers have stated that the yarn spinners have indulged in anti-profiteering activities and that the GST Council and the state GST commissioner must immediately intervene for the overall benefit of power loom weavers.

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