The shoes pinches — Bahadurgarh industrialists seek 5% GST cut on footwear

Footwear industrialists in Bahadurgarh have called for the Goods and Services Tax (GST) rate on footwear to be reduced from 12% to 5% to safeguard the industry from losses. They have also raised this issue with Union Finance Minister Nirmala Sitharaman, urging her to consider their request to provide a much-needed boost to the footwear sector.

“Bahadurgarh Footwear Park is the largest non-leather footwear hub in the country, with over 2,500 units associated directly and indirectly with it. Around one crore pairs of footwear are manufactured here daily, contributing to 60 per cent of the nation's non-leather footwear production. In January 2022, the GST rate on footwear priced up to Rs 1,000 was increased from 5% to 12%. This hike has not only hindered the growth of the footwear industry but also has placed an additional financial burden on the common man,” said Narendra Chhikara, senior vice-president, Bahadurgarh Footwear Park Association.

He said the GST rate hike had adversely affected the business to a large extent, as 90% of footwear products were priced below Rs 1,000. These affordable products were primarily purchased by common people, particularly those from economically weaker sections. The increase in the GST rate had led to a considerable rise in footwear prices, making them unaffordable for many. Additionally, the hike had resulted in a 25% drop in footwear sales in the region, he added.

“A 12% GST rate on footwear is excessive, hence we are consistently raising this issue with the government and other authorities to get our demand for reduction of GST up to 5% met. This time, industrialists are expecting relief regarding the GST rate on footwear in the upcoming Union Budget,” he said.