SRINAGAR: It is now the state bureaucracy that is saying that levying the Goods and Services Tax (GST) will bring ruin to industries, particularly to the handicraft industry, in Jammu and Kashmir.
Commissioner Secretary Industries & Commerce, Shailendra Kumar, told Kashmir Reader that the GST will have a bad impact on the industries sector. “The tax will make our products less competitive. We are with businessmen (who oppose the GST) at this point of time,” he said.
Assistant Director Handicrafts Department, Mushtaq Ahmad, said that “it will be suicide” to levy the tax, as traders are currently in no position to bear any extra financial burden.
Chief Minister Mehbooba Mufti has recently called for waiving off the 12 percent GST from the state’s handicrafts, which in the previous tax regime had no tax levied on them. “Handicrafts cost more for skills than for raw material. If the tax is levied on the skill, then it becomes a burden on the artisan. The trade in handicrafts will decline if the government does not roll back the tax,” Mushtaq said.
Mushtaq said that many handicrafts have a small shelf life, which means that an item made this year cannot be sold ten years later. “An artisan has to pay the tax in advance, though he has no guarantee that he will earn in the same year. Also, artisans are not tech-savvy. They will face difficulties while dealing with the GST system. The trade is going through a stress period because markets that fetch good money are going through a recession,” he explained.
Traders are already up in arms against the GST. They are planning street protests after the government has shown no inclination to roll back the tax. The industries sector, of which handicrafts is one of the main constituents, contributes 15 to 20 percent of the state’s Gross Domestic Product.
President of the Federation of Chambers of Industries Kashmir, Muhammad Ashraf Mir, said that in the new regime many industrial sectors will have to pay 18 percent tax while handicraft will have to pay 12 percent. “We are hopeful that the government will issue an order that will exempt these industrial sectors, like it was earlier,” he said.
Shailendra Kumar said that he was hopeful that the chief minister and finance minister were serious about helping the businessmen.
“Though there is no provision of exemption in GST, the state and centre have worked out modalities of how the exemption can be given. Let’s wait,” he said.