Vijayawada: Take up GST hike with Centre, State urged

TDP national general secretary Nara Lokesh

TDP national general secretary Nara Lokesh 


  • TDP leader Lokesh writes to CM explaining the adverse effects of GST hike on handloom sector which is already reeling under crisis
  • Says proposed GST rate increase on textile and handloom products from 5% to 12% from Jan 1 will raise production, marketing costs for the small, labour-intensive sector

Vijayawada: TDP national general secretary Nara Lokesh on Monday urged Chief Minister YS Jagan Mohan Reddy to take up the GST hike issue with the Centre as it had come as a death sentence for the handicrafts sector and textiles.

In a letter to the Chief Minister here on Monday, Lokesh said the increased GST rate would become a burden on the weaving and artisan communities. These sections would get further mire in a deepened financial crisis without a subsidy from the government. Lokesh said, "The GST rate on textile and handloom products is set to be increased from 5 per cent to 12 per cent from January 1, 2022. Most of the textile making units, especially in the handloom sector, are small. Their profit margins are low, between 2-5 per cent on average.

A higher tax burden will throw their lives into disarray. Production and marketing costs for such labour-intensive products will become loss-making." He said states like Telangana and Tamil Nadu were contemplating waiving the tax (through subsidy) completely or at least to maintain it at the old rates while urging the state government to adopt similar measures.

The APCO should buy products from MSME textile units. The AP 'Nethanna Nestham' would be of no use if higher tax ate into their already low margins, he said adding that there was a need to reinstate input subsidies to decrease cost of production. Lokesh stressed on the need for bringing back the thrift fund scheme, production-linked incentives and subsidized loans that were popular during the previous government.

The AP contribution to the textile heritage of India had been huge and significant. The state artisans were known for their unique khadi and handloom traditions. He recalled the greatness of Ponduru khadi which even Mahatma appreciated and urged the Chief Minister to preserve the handlooms industry intact.

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