Good and Service Tax (GST) is one of the biggest tax reforms since Independence and is going to implement from 1st July. Traders and businessmen across Gujarat, including Surat, Ahmedabad, Morbi, and other industrial hubs are expressing opposition to the new taxation regime.
Generally, all manufacturers or producers in Gujarat city are opposing for the indirect taxation regime from 1st July. Owners or manufacturers of Diamond Cutting or polishing industry in Surat, power-loom operators, textile traders, manufacturers of ceramic tiles in Morbi and North Gujarat have made presentations and opposing for the new taxation regime, which will remove the State and Central Taxes such as excise, Value Added Tax.
Gaurang Bhagat, President of Mascati Cloth Merchants Association in Ahmedabad said that “We have been exempted from any kind of sales tax and VAT since 1957. The 5% GST imposed on yarn and fabric will hurt those in the business of selling cloth. The process of GST is lengthy and it will start an ‘inspector raj’ in our industry.”
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In Surat, nearly 80,000 textile traders are operating the business in 120 textile markets across the city and gaining a turnover of INR 100 Crore on the basis of daily routine. Several traders and businessmen in Gujarat have shut their doors on Thursday and Friday for opposing against new Goods and Service Tax Regime.
Presently, around a million people are working in the diamond-cutting and polishing industry in Surat which protests against new GST Regime. They are demanding to remove 3 percent GST on polished diamond items.
A famous diamond baron from Surat said that “We are a labour-intensive sector that provides employment to lakhs of people. The introduction of GST on polished diamonds will severely harm our business.”
A BJP legislator from the State said, “Gujarat is predominantly a manufacturing State. So the GST will have an adverse impact on sectors such as ceramics because businesses that right now pay 12.5 % excise and 5% VAT must, under the new law, pay 28% tax on ceramic tiles and other products.”
Trade bodies and industry associations have urged the Central, as well as the State Government, seeking for the exemptions or for a lower rate or some modifications in GST rates. A senior official from the state finance department said that “We are looking into the representations received from various industries and trade bodies”.
