GST Surge: Fashion's Pricey Transition Above Rs 2,500
The GST rate on garments priced above Rs 2,500 increases from 12 to 18 percent, potentially impacting middle-class affordability and the organized retail sector. Industry bodies urge for a more reasonable price threshold or a unified lower tax rate. Footwear under Rs 2,500 is taxed lower.
- Country:
- India
Garments priced above Rs 2,500 will see a GST rate increase from 12% to 18%, following the GST Council's recent decision. Industry organizations warn this could hurt middle-class affordability and the organized retail sector.
Both the Retailers Association of India and Clothing Manufacturers Association of India are voicing concerns that the new tax rate on apparel and clothing accessories exceeding Rs 2,500 might lead to weakened demand among common consumers. They urge the government to consider a uniform tax rate of 5% for all textile products to maintain affordability and support the sector.
While this change affects garments, footwear priced below Rs 2,500 gets a reduced GST of 5%, a move welcomed by the industry. The retailers' body supports the two-slab GST framework as a positive step towards fair and straightforward taxation.
(With inputs from agencies.)
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