Apparel exporters seek tax incentives in Budget to boost manufacturing

The Apparel Export Promotion Council (AEPC), an apparel exporters body has requested for tax incentives such as uniformity in goods services tax (GST) and enhanced interest subsidies to boost domestic manufacturing and exports.

Additionally, the council also sought budgetary support for the branding and marketing of made-in-India products.

“High cost of capital has been a major bottleneck for the exporting community. AEPC has requested the government to increase the rates under the scheme to 5 percent for all the apparel exporters. It will increase the apparel industry’s competitiveness in the international market and enable them to avail necessary working capital,” AEPC said in a statement.

“Regarding the Goods and Services tax (GST), it said that a uniform tax of 5 percent only should be levied across the entire MMF (Man-Made Fibre) value chain (fibre, yarn, and fabric). Currently, the MMF GST rate on fibre is 18 per cent, yarn 12 per cent, and fabric 5 per cent, resulting in unutilised input credit and consequent liquidity issues for MSME units,” the council added.

The Budget is scheduled to be presented in the parliament on February 1.