Levy on garment industry opposed..in The Hindu in 2003

Industry & Economy - Knitwear & Hosiery


Levy on garment industry opposed..in The Hindu in 2003
Our Bureau

Various garment bodies have appealed to the Union Finance Minister, Mr Jaswant Singh, to remove the levy.

BANGALORE, March 17

THE garment trade and industry is in turmoil over the Budget proposal removing SSI exemption on garment for excise duty with effect from April 1 this year.

It says the move would be fatal to the domestic garment sector, killing several small and mid-sized units and create large-scale unemployment.

Various garment bodies have appealed to the Union Finance Minister, Mr Jaswant Singh, to remove the levy. They plan to go on a one-day protest closure against the imposition.

Mr Anurag Singhla, Chairman (Taxation), Karnataka Hosiery and Garment Association, said withdrawal of SSI exemption would push up the prices of readymade garments.

The levy will benefit big brands at whose behest it has been imposed, and will slowly choke traditional Indian industry and their tiny stitching units for lack of excise registration, he said.

Mr Ram T. Harpalani, President of the South India Garments Association, said the Rs 3-crore limit on SSI exemption should be re-introduced to avert the disastrous implications of the levy.

"When SSI exemption has been given to many luxury items like cosmetics, ACs, watches etc, it is unfair to single out basic necessities like garments. The raw materials like fabric, yarn, thread, buttons and zips are subject to excise duty and there is no justification in levying extra excise for stitching," according to Mr Sajjan Raj Mehta, Association Secretary. Faced with cheap imports from Thailand, China and Hong Kong, local goods would lose their markets, he said.

Bellary in northern Karnataka has over 10,000 families - mostly poor women — dependent on the garment industry.

"The move is a deathblow to small manufacturing units and would create large scale unemployment in rural areas," according to Mr Babulal, Secretary, Bellary Garment Manufacturers' Association.



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