India’s Export Promotion Council for Handicrafts (EPCH) recently held a Stakeholders’ Consultation Meet at EPCH House, New Delhi, wherein representatives of industry associations and exporters gathered to discuss the implications of Goods and Services Tax (GST) on handicraft sector.
GST, one of the biggest taxation reforms in India, is a comprehensive tax levy on manufacture, sale and consumption of goods and services at a National level. GST is all set to integrate the state economies and boost overall growth.
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Major issues of handicrafts sector which the exporter apprehend will have adverse impact on their business discussed during the meeting include – possible exemption of handicrafts sector from the purview of GST; blocking of working capital, which will result in high cost of capital, in case handicrafts sector is not exempted; tax free procurement of goods for merchant exporters; clarifying the procedure of procuring job workers; simplifying refund procedure; duty drawback rate to factor increased tax cost on procurements of input material.
EPCH has engaged the services of a leading tax consultant with expertise on GST matters to prepare a petition on behalf of handicrafts exporters to be submitted the GST Council, Ministry of Finance, Government of India. A similar petition will also be forwarded through various State Governments to the Ministry of Finance, Government of India so that the interests of handicrafts sector can be safeguarded. A meeting with Union Finance Minister and other senior Government officials is likely to be held shortly wherein the petition will be submitted.
During the meeting, it was decided by the members of EPCH to approach the Finance Minister of their respective State Governments who are members of the GST Council. It would be an additional help to highlight the issues concerning GST with respect Handicrafts sector.
It might be mentioned here that the exports of handicrafts during the first six months of 2016-2017 are Rs. 13,005.35 crore, registering a growth of 18.28 per cent over the same period last year.
