Industry & Economy
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Budget
`Keep fabrics out of VAT ambit'
Our Bureau
Mumbai
,
Feb. 9
MUMBAI Textiles Merchants' Mahajan has demanded that VAT should not be imposed on fabrics and additional excise duty on fabrics should continue.
Textile fabrics are currently outside the purview of sales tax and VAT.
In a pre-Budget memorandum, Mr Surendra T. Savai, President, Mumbai Textiles Merchants' Mahajan, said that excise duty on man-made fibres should be reduced to 8 per cent from 16 per cent. Customs duty on man-made fibres should be removed. Excise duty on textile machinery and spares should also be reduced to 8 per cent, he said. However, for import of second hand machines, a uniform rate of 10 per cent customs duty may be imposed in order to ensure that domestic textile machinery industry is not adversely affected, he said.
After abolition of excise duty on fabrics, the domestic cloth market has become very healthy. After abolition of quota, exports of value-added textiles have gone up. The textile industry is expected to invest Rs 1,40,000 crore in next few years. The industry is expected to double its exports and the industry is expected to create 12 million additional jobs in the near future.
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