AEPC has proposed to the Ministry of Finance for the continuation of Rebate of State Levies (RoSL) Scheme post GST implementation and inclusion of other state levies not subsumed in the GST. The Council has also requested for a drawback for central taxes outside the GST purview besides full accumulated input GST Tax Credit.
In a presentation made before the drawback committee, AEPC apprised the committee about the instance of embedded blocked taxes which the Industry is facing in central taxes. The committee was also apprised about the new levies like intra company stock transfers, GST on job work, etc. which has been imposed in the GST regime but not being factored in earlier announced drawback rates, will lead to cost escalation, especially in the transitionary phase.
Commenting on AEPC’s presentation to the drawback committee, Ashok G Rajani, Chairman Apparel Export Promotion Council said, “Garment Industry welcomes GST as a move to unify the national economy, but this should not be at the cost of the growth of the apparel sector. For the vast number of SMEs in this sector, for whom this whole taxation system and procedures are new, a longer transition phase would have helped. I hope that the government keeps a sympathetic view towards the demands of the Industry. The GST has diluted most of the FTP benefits that the industry was availing so far besides putting a huge pressure on the working capital. It is now important that all the taxes - direct and indirect are reimbursed under the drawback and ROSL benefits. ”
In its submission to the drawback committee, AEPC has also made a request for exempting samples from GST to buying agents / buyers within India or abroad as sending samples to buying agents / buyers within India is a prerequisite for getting business.