Apparel and footwear prices will surge as the Central Board of Indirect Taxes and Customs (CBIC) has raised the goods and services tax (GST) on finished goods from 5% to 12%.

The board has notified about the same on November 18.

Apparel and footwear to get costlier

The GST rate of garments has been hiked to 12 per cent from 5 per cent and this increase in cost will be effective from January 2022. In its meeting that was conducted in September, the GST Council had promised to rectify the inverted duty structure in textile and footwear.

As per media reports, the Clothing Manufacturers Association of India has expressed their disappointment with the government’s decision as it will have a major impact as the industry is dealing with inflationary headwinds.

List of textiles to witness surge in price from 5 per cent to 12 per cent

• Pile fabrics
• Woven fabrics
• Synthetic yarn
• Tents
• Blankets
• Accessories like rugs, tablecloths, serviettes, and tapestries.

According to reports, Rajesh Masand, President of CMAI said in a statement that the association and other trade bodies all over India have been vigorously representing to the government and GST Council not to implement this change and it is indeed extremely disappointing that the Council has chosen not to heed their plea.

The statement also stated that the market was expected to see a 15-20 per cent price hike in apparel cost in the coming season even without the GST rate increase. Over 80 per cent of India’s apparel market consists of garments that cost below Rs 1,000.

In other news, the Union Health Ministry has activated a new service on the Cowin portal. The new feature in the Cowin app will let others know the vaccination status-fully or partially vaccinated- of any citizen. Here’s how to check the vaccination status.

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