Retailers Association of India (RAI) requested state governments and the GST Council to revise the suggested hike in GST rates on textiles and apparel items to 12 per cent as it will impact 85 per cent of the sector. “However, such an increase in the GST rate will impact 85 per cent of the industry while trying to reduce the problem faced by not over 15 per cent of the industry,” RAI said in a statement.

RAI CEO Kumar Rajagopalan said, “The rise in GST rates on textiles and apparel is not in anybody’s favour due to its impact. It will add to the financial burden of an already-stressed sector, slow down its speed of recovery and affect working capital requirements in the case of MSME businesses. For the consumers, it will increase the costs of garments. On the government side, it may lead to several unorganised businesses going out of the GST.”

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RAI requested “the government and GST Council to rethink its decision to stop the collapse of the textile sector and keep an atmosphere of hope and certainty.” It further said, “A better beneficial and reasonable solution is to keep the whole value chain subject to a 5 per cent GST rate. This will resolve the duty structure exception and also give a blow to the industry.”