The Punjab Textile Merchant Association has urged Punjab Finance Minister Harpal Singh Cheema to oppose proposed changes to the Goods and Services Tax (GST) on garments at the upcoming GST Council meeting.
In a letter to Cheema, association members highlighted their concerns over the potential increase in GST rates. The proposals include raising the GST from 12 per cent to 18 per cent on garments priced between Rs 1,500 and Rs 10,000 and imposing a 28 per cent GST on garments priced above Rs 10,000. The traders warned that such measures would severely impact the already strained garment sector.
“As the Finance Minister of Punjab and a member of the GST Council, your role is crucial in safeguarding the interests of industries and workers in the state,” the letter stated. The association argued that increasing the GST to 18 per cent for mid-range garments would make them unaffordable for middle-income consumers, leading to decreased demand and slower sales. Meanwhile, the proposed 28 per cent GST on high-end garments would shrink the premium market, discouraging purchases and pushing businesses into financial trouble.
The garment industry, heavily reliant on small and medium enterprises (SMEs), operates on narrow profit margins. Association members warned that businesses would struggle to absorb the increased tax burden, which could result in closures and significant job losses.
The traders called on Cheema to advocate for the industry’s needs and ensure that policies support its growth rather than exacerbating its challenges. They emphasised that the proposed GST hikes could undermine the sector’s contribution to Punjab’s economy and employment. The upcoming GST Council meeting will likely address these proposals, and industry stakeholders await its outcomes with concern.
