Traders to continue shutdown

Manav Mander

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Tribune News Service

Ludhiana, June 29

On a call given by the Bhartiya Udyog Vyapar Mandal (BUVM), various trades in the city will remain shut tomorrow (June 30) against the implementation of goods and services tax (GST). Cloth merchants and furniture manufacturers have been on strike for the past three days. They will continue their agitation.

The BUVM is protesting the strict provisions of GST, which, it believes, can prove fatal for the growth of unorganised and small traders. The mandal has demanded that there should not be more than 15 per cent tax on any item.

Paul Khurana, chairman of the Punjab Furniture Association, said the traders had not yet overcome the losses caused by demonetisation and now GST is here to further make the things worse for them. “We are not against GST but all we are demanding is that the tax slab on furniture should be reduced. The present 28 per cent GST on wooden furniture is too high. We want the rate to be reduced to 12 per cent. The sale of furniture has come down to one-fourth and we are left with no other option but to lay off labour,” he said.

Jagdish Kumar from Mochpura Bazar said shawl traders had also decided to go on strike tomorrow. “There has never been any tax on shawls since it is handmade material. Artisans have been making these for centuries. This will only make the things worse for them as they will not be able to comply with the strict provisions of GST,” he said.

Cloth merchants are already up in arms against 5  per cent GST imposed on fabric. Artisans have meagre sources and are  earning a living through their skill. But even they will now  come under GST and will be required to file returns. The artisans  with annual turnover less than Rs 20 lakh will not be covered under GST. The imposition of 5 per cent GST on textile job work has come as a blow to  these artisans. 

“It will be impossible to  expect small craftsmen to register and file three monthly returns. If we  don’t file returns, we will not get our claims. It’s going to be a  difficult situation not only for artisans but also for wholesalers like  us,” said Surjan Singh, a cloth wholesaler at Chaura Bazar.

Sanju  Dhir, chairman of Ludhiana Woollen Manufacturers Association, said the traders were not against the implementation of GST but its harsh provisions. “One clause also includes  imprisonment. We are no criminals that we will be sent to jail. One should  be fined but we don’t understand the need  for imprisonment. The government should have given a relaxation period of at least a year from  these harsh provisions,” said Dhir. 

Expert take 

Gurmeet Singh, a cost accountant, said: “GST  will unify at least 15 Central and state taxes into one. It aims at making India a market with common tax rates and procedures. It will remove the economic barriers, thus paving the way for an integrated  economy at the national level. It is a destination-based tax on  goods and services. Tax will accrue to the state or the  Union Territory where consumption takes place. It is to be levied at  all stages, right from manufacturing up to final consumption with credit  of taxes paid at previous stages available as set-off. Only value addition will be taxed and the burden of tax is to be borne by the final  consumer.” 

Goods kept outside GST purview temporarily

1. Alcohol for human consumption

2. Five petroleum products, crude, motor spirit (petrol), high speed diesel, natural gas and aviation turbine fuel

3. Electricity 

(the existing taxation system, i.e. vat and central excise, will continue in respect of these commodities)

Composition levy scheme

Small  taxpayers with an aggregate turnover in a financial year up to   Rs 75 lakh shall be eligible for composition levy. Under the scheme, a  taxpayer shall pay tax as a percentage of his turnover during the year without the benefit of input tax credit.

Exemption threshold  

Taxpayers  with an aggregate turnover up to Rs 20 lakh are exempt from tax. Turnover shall be computed on an all-India basis. For north-eastern states and those in a special category, the threshold will be Rs 10 lakh. All taxpayers eligible for threshold  exemption will have the option of paying tax with input tax credit benefits. Taxpayers making inter-state supplies or paying tax on  reverse charge basis shall not be eligible for threshold exemption.