GST Hike on Garments: Impact on Industry & Consumers

New Delhi, Sep 2 (PTI) The government's proposal to increase tax on garments over Rs 2,500 by putting them in a higher slab of 18 per cent under the proposed GST reforms will impact the middle class consumers and organised manufacturers, CMAI said on Tuesday.

Despite repeated assurances from various quarters, there are reports that garments above Rs 2,500 are likely to be taxed at 18 per cent, from their current level of 12 per cent, the Clothing Manufacturers Association of India (CMAI) said in a statement.

"This will spell a death knell to the industry already reeling under the crisis of the American tariff wars," the association said.

Almost the entire range of woolen garments, which are essential clothing for the middle-class, are currently priced between Rs 3,500 and Rs 7,000.

Putting such garments in the 18 per cent slab will mean the middle class indians will have to pay more during the bitterly cold winters, it said.

CMAI is an association of the Indian apparel industry, having over 5,000 members and serving more than 35,000 retailers. Its membership consists of manufacturers, exporters, brands, and ancillary industry.