Changes in GST Rates Applicable From 01.01.2022
Government has proposed to make changes in GST rates in various sectors affecting mainly textiles, footwear and e-commerce businesses from 1st January 2022.
In this regards government has issued various notifications as mentioned below:
|
Notification no. |
Date |
Sector |
|
Notification No. 14/2021-CT (Rate) |
18.11.2021 |
Textile Sector |
|
Notification No. 15/2021-CT (Rate) |
18.11.2021 |
Textile Sector |
|
Notification No. 14/2021-CT (Rate) |
18.11.2021 |
Footwear sector |
|
Notification No. 16 & 17/2021-CT (Rate) |
18.11.2021 |
E-commerce Sector |
Let us see the changes in rates sector wise and how it will have an impact on seller or consumers.
Textile Sector
The finance ministry on November 18, has notified about 7% increase in GST rates in textile sector. This industry from years was making representations to the finance ministry to address the anomaly in the input and output tax rates.
In most of the cases, input rate was higher as compared to the output rates. The sector was expecting the change to be as lower rates in input purchases.
However, the government has stated that even the finished goods in textile industry will now be taxed at 12% from earlier rate of 5%.
The hike in the output GST has now caused pain in the sector as the sector is mainly dominated by MSMEs and MSMEs have already affected hard due to the pandemic and now due to the increased GST rates.
As per the industry people, adding 12% GST on clothing which is a basic need is totally unjustifiable.
The below table can be seen for changes in GST rates across different products in textile industry:
|
HSN Code |
Description of Goods |
Old rate |
New rate |
|
5007 |
WOVEN FABRICS OF SILK OR OF SILK WASTE |
5% |
12% |
|
5111 |
WOVEN FABRICS OF CARDED WOOL OR OF CARDED FINE ANIMAL HAIR - Containing 85% or more by weight of wool or of fine animal hair |
5% |
12% |
|
5112 |
WOVEN FABRICS OF COMBED WOOL OR OF COMBED FINE ANIMAL HAIR - Containing 85% or more by weight of wool or of fine animal hair |
5% |
12% |
|
5113 |
WOVEN FABRICS OF COARSE ANIMAL HAIR OR of horse hair |
5% |
12% |
|
5208 |
WOVEN FABRICS OF COTTON, CONTAINING 85% OR MORE BY WEIGHT OF COTTON, WEIGHING NOT MORE THAN 200 G/M2 - Unbleached |
5% |
12% |
|
5209 |
WOVEN FABRICS OF COTTON, CONTAINING 85% OR MORE BY WEIGHT OF COTTON, WEIGHING MORE THAN 200 G/M 2 - Unbleached |
5% |
12% |
|
5210 |
WOVEN FABRICS OF COTTON, CONTAINING LESS THAN 85% BY WEIGHT OF COTTON, MIXED MAINLY OR SOLELY WITH MAN-MADE FIBRES, WEIGHING NOT MORE THAN 200 G/M 2 - Unbleached |
5% |
12% |
|
5211 |
WOVEN FABRICS OF COTTON, CONTAINING LESS THAN 85% BY WEIGHT OF COTTON, MIXED MAINLY OR SOLELY WITH MAN-MADE FIBRES, WEIGHING MORE THAN 200 G/M2 - Unbleached |
5% |
12% |
|
5212 |
OTHER WOVEN FABRICS OF COTTON - Weighing not more than 200 g/m2 |
5% |
12% |
|
5309 |
WOVEN FABRICS OF FLAX - Containing 85% or more by weight of flax |
5% |
12% |
|
5310 |
WOVEN FABRICS OF JUTE OR OF OTHER TEXTILE BASE FIBRES OF HEADING 5303 |
5% |
12% |
|
5311 |
WOVEN FABRICS OF OTHER VEGETABLE TEXTILE FIBRES; WOVEN FABRICS OF PAPER YARN |
5% |
12% |
|
5402 |
SYNTHETIC FILAMENT YARN (OTHER THAN SEWING THREAD), NOT PUT UP FOR RETAIL SALE, INCLUDING SYNTHETIC MONOFILAMENT OF LESS THAN 67 DECITEX - High tenacity yarn of nylon or other polyamides |
12% /18% |
12% |
|
5403 |
ARTIFICIAL FILAMENT YARN (OTHER THAN SEWING THREAD), NOT PUT FOR RETAIL SALE, INCLUDING ARTIFICIAL MONO FILAMENT OF LESS THAN 67 DECITEX |
12% /18% |
12% |
|
5404 |
SYNTHETIC MONOFILAMENT OF 67 DECITEX OR MORE AND OF WHICH NO CROSSSECTIONAL DIMENSION EXCEEDS 1 MM; STRIP AND THE LIKE (FOR EXAMPLE, ARTIFICIAL STRAW) OF SYNTHETIC TEXTILE MATERIALS OF AN APPARENT WIDTH NOT EXCEEDING 5 MM - Monofilament |
12% /18% |
12% |
|
5405 |
ARTIFICIAL MONOFILAMENT OF 67 DECITEX OR MORE AND OF WHICH NO CROSS-SECTIONAL DIMENSION EXCEEDS 1 MM; STRIP AND THE LIKE (FOR EXAMPLE, ARTIFICIAL STRAW) OF ARTIFICIAL TEXTILE MATERIALS OF AN APPARENT WIDTH NOT EXCEEDING 5 MM |
12% /18% |
12% |
|
5406 |
MAN-MADE FILAMENT YARN (OTHER THAN SEWING THREAD), PUT UP FOR RETAIL SALE |
12% /18% |
12% |
|
5407 |
WOVEN FABRICS OF SYNTHETIC FILAMENT YARN, INCLUDING WOVEN FABRICS OBTAINED FROM MATERIALS OF HEADING 5404 |
5% |
12% |
|
5408 |
WOVEN FABRICS OF ARTIFICIAL FILAMENT YARN,INCLUDING WOVEN FABRICS OBTAINED FROM MATERIALS OF HEADING 5405 |
5% |
12% |
|
5501 |
WOOL, NOT CARDED OR COMBED SYNTHETIC FILAMENT TOW |
18% |
12% |
|
5502 |
ARTIFICIAL FILAMENT TOW |
18% |
12% |
|
5503 |
SYNTHETIC STAPLE FIBRES, NOT CARDED, COMBED OR OTHERWISE PROCESSED FOR SPINNING - Of nylon or other polyamides |
18% |
12% |
|
5504 |
ARTIFICIAL STAPLE FIBRES, NOT CARDED, COMBED OR OTHERWISE PROCESSED FOR SPINNING |
18% |
12% |
|
5505 |
WASTE (INCLUDING NOILS, YARN WASTE AND GARNETTED STOCK) OF MAN-MADE FIBRES |
18% |
12% |
|
5506 |
SYNTHETIC STAPLE FIBRES, CARDED COMBED OR OTHERWISE PROCESSED FOR SPINNING |
18% |
12% |
|
5507 |
ARTIFICIAL STAPLE FIBRES, CARDED, COMBED OR OTHERWISE PROCESSED FOR SPINNING |
18% |
12% |
|
5512 |
Woven fabrics of synthetic staple fibres, CONTAINING 85% OR MORE BY WEIGHT OF SYNTHETIC STAPLE FIBRES - Containing 85% or more by weight of polyester staple fibres |
5% |
12% |
|
5513 |
WOVEN FABRICS OF SYNTHETIC STAPLE FIBRES, CONTAINING LESS THAN 85% BY WEIGHT OF SUCH FIBRES, MIXED MAINLY OR SOLELY WITH COTTON, OF A WEIGHT NOT EXCEEDING 170 g/m2 - Unbleached or bleached |
5% |
12% |
|
5514 |
WOVEN FABRICS OF SYNTHETIC STAPLE FIBRES, CONTAINING LESS THAN 85% BY WEIGHT OF SUCH FIBRES, MIXED MAINLY OR SOLELY WITH COTTON, OF A WEIGHT EXCEEDING 170 G/M2 - Unbleached or bleached |
5% |
12% |
|
5515 |
OTHER WOVEN FABRICS OF SYNTHETIC STAPLE FIBRES - Of polyester staple fibres |
5% |
12% |
|
5516 |
WOVEN FABRICS OF ARTIFICIAL STAPLE FIBRES - Containing 85% or more by weight of artificial staple fibres |
5% |
12% |
|
5607 |
TWINE, CORDAGE, ROPES AND CABLES, WHETHER OR NOT PLAITED OR BRAIDED AND WHETHER OR NOT IMPREGNATED, COATED, COVERED OR SHEATHED WITH RUBBER OR PLASTICS - Of sisal or other textile fibres of the genus Agave |
5% |
12% |
|
5608 |
KNOTTED NETTING OF TWINE, CORDAGE OR ROPE; MADE UP FISHING NETS AND OTHER MADE UP NETS, OF TEXTILE MATERIALS - Of man-made textile materials |
5% |
12% |
|
5801 |
WOVEN PILE FABRICS AND CHENILLE FABRICS, OTHER THAN FABRICS OF HEADING 5802 OR 5806 |
5% |
12% |
|
5806 |
NARROW WOVEN FABRICS OTHER THAN GOODS OF HEADING 5807; NARROW FABRICS CONSISTING OF WARP WITHOUT WEFT ASSEMBLED BY MEANS OF AN ADHESIVE (BOLDUCS) |
5% |
12% |
|
5808 |
BRAIDS IN THE PIECE; ORNAMENTAL TRIMMINGS IN THE PIECE, WITHOUT EMBROIDERY, OTHER THAN KNITTED OR CROCHETED; TASSELS, POMPONS AND SIMILAR ARTICLES |
5% |
12% |
|
5809 |
WOVEN FABRICS OF METAL THREAD AND WOVEN FABRICS OF METALLISED YARN OF HEADING 5605, OF A KIND USED IN APPAREL, AS FURNISHING FABRICS OR FOR SIMILAR PURPOSES, NOT ELSEWHERE SPECIFIED OR INCLUDED |
5% |
12% |
|
6001 |
PILE FABRICS, INCLUDING LONG PILE FABRICS AND TERRY FABRICS, KNITTED OR CROCHETED |
5% |
12% |
|
6002 |
KNITTED OR CROCHETED FABRICS OF A WIDTH NOT EXCEEDING 30 CM, CONTAINING BY WEIGHT 5% OR MORE OF ELASTOMERIC YARN OR RUBBER THREAD, OTHER THAN THOSE OF HEADING 6001 |
5% |
12% |
|
6003 |
KNITTED OR CROCHETED FABRICS OF A WIDTH NOT EXCEEDING 30 CM, OTHER THAN THOSE OF HEADING 6001 OR 6002 |
5% |
12% |
|
6004 |
KNITTED OR CROCHETED FABRICS OF A WIDTH EXCEEDING 30 CM, CONTAINING BY WEIGHT 5% OR MORE OF ELASTOMERIC YARN OR RUBBER THREAD, OTHER THAN THOSE OF HEADING 6001 |
5% |
12% |
|
6005 |
WARP KNIT FABRICS (INCLUDING THOSE MADE ON GALLOON KNITTING MACHINES), OTHER THAN THOSE OF HEADINGS 6001 TO 6004 ---- Of cotton |
5% |
12% |
|
6006 |
OTHER KNITTED OR CROCHETED FABRICS |
5% |
12% |
|
61 |
Articles of apparel and clothing accessories, knitted or crocheted |
5% |
12% |
|
62 |
Articles of apparel and clothing accessories, not knitted or crocheted |
5% |
12% |
|
6301 |
BLANKETS AND TRAVELLING RUGS |
5% |
12% |
|
6302 |
BED LINEN, TABLE LINEN, TOILET LINEN AND KITCHEN LINEN |
5% |
12% |
|
6303 |
CURTAINS (INCLUDING DRAPES) AND INTERIOR BLINDS; CURTAIN OR BED VALANCES - Knitted or crocheted |
5% |
12% |
|
6304 |
OTHER FURNISHING ARTICLES, EXCLUDING THOSE OF HEADING 9404 - Bedspreads |
5% |
12% |
|
6305 |
SACKS AND BAGS, OF A KIND USED FOR THE PACKING OF GOODS |
5% |
12% |
|
6306 |
TARPAULINS, AWNINGS AND SUNBLINDS; TENTS; SAILS FOR BOATS, SAILBOARDS OR LANDCRAFT; CAMPING GOODS - Tarpaulins, awnings and sunblinds |
5% |
12% |
|
6307 |
OTHER MADE UP ARTICLES, INCLUDING DRESS PATTERNS |
5% |
12% |
|
6308 |
II..SETS SETS CONSISTING OF WOVEN FABRIC AND YARN, WHETHER OR NOT WITH ACCESSORIES, FOR MAKING UP INTO RUGS, TAPESTRIES, EMBROIDERED TABLE CLOTHS OR SERVIETTES, OR SIMILAR TEXTILE ARTICLES, PUT UP IN PACKINGSFOR RETAIL SALE |
5% |
12% |
|
6309 |
WORN CLOTHING AND OTHER WORN ARTICLES |
5% |
12% |
|
6310 |
USED OR NEW RAGS, SCRAP TWINE, CORDAGE, ROPE AND CABLES AND WORN OUT ARTICLES OF TWINE, CORDAGE, ROPE OR CABLES, OF TEXTILE MATERIALS |
5% |
12% |
|
5810 |
EMBROIDERY IN THE PIECE, IN STRIPS OR IN MOTIFS |
5% |
12% |
Footwear Sector
With regards to footwear rates also, GST has been increased from 5% to 12%.
Footwears are also general necessity item and increased GST will result in more costlier footwears. Common man will face more burden on his pocket from now on.
The below table can be seen for changes in GST rates across different products in footwear industry:
|
HSN Code |
Description of Goods |
Old rate |
New rate |
|
64 |
Footwear having a retail sale price not exceeding Rs.1000 per pair, provided that such retail sale price is indelibly marked or embossed on the footwear itself. |
5% |
12% |
E-commerce Sector
The scope of taxability of the service of transportation of passengers through electronic commerce operators has increased. The government has brought into GST purview some more services which were earlier exempt from GST.
|
HSN Code |
Description of Goods |
Old Rate |
New rate |
|
9964 |
Transport of passengers, with or without accompanied belongings, by: |
Exempted |
5% |
|
9964 |
Service of transportation of passengers, with or without accompanied belongings, by: |
Exempted |
5% |