GST on carpet will be slashed from 12% to 5%: Haseeb Drabu

Admitting that the carpet industry is passing through difficult times, the minister for finance, Dr Haseeb Drabu assured that Goods and Services tax charged on carpets will be slashed from 12 to 5 percent in coming days to give a breather to people affiliated with this indigenous craft.
“State government has fulfilled all the commitments it had made after implementation of GST except one that is carpet industry. Every segment of trade is in distress, but carpet artisans and dealers are more worried, although it has nothing to do with GST but due to the global scenario,” Drabu said while speaking at the Kashmir’s first business conclave held on Sunday in which heads of all the business organisations participated.
He assured the carpet industry that the rate of GST on carpets will be slashed from current 12 to 5 percent.
To this, the carpet dealers present on the occasion urged him that it should be bought under zero taxation. Drabu replied “It is for your (carpet dealers) benefit. As under5 percent GST you will get 7 percent input tax credit which is beneficial for you,” he said while underscoring the need for government’s intervention to safeguard the carpet sector.
“Every segment of trade is in distress, but the carpet sector needs government intervention more than anybody else at this moment. Because if we don’t intervene, we won’t see Kashmiri carpet anywhere in next two or three years,” he said adding that government’s focus at this time is trade, handicrafts and tourism sector.
Calling handicraft a cultural industry, Drabu said “Despite incentives, unless handicraft is not profitable, artisans will continue to suffer. It not only a financial problem but I believe it is a social problem. No artisan is ready to make his son an artisan. In downtown we are witnessing that artisans of indigenous crafts are leaving their work and doing menial jobs like working as salesmen, driving autos to etch their livelihood.”
“Because of this fact we are losing our cultural industry,” he said adding that the government will prepare a comprehensive policy for safeguarding interests of the handicraft sector.
Later talking demand of artisans seeking waivers of loans under artisan credit card scheme. Chief Minister, Mehbooba Mufti intervened and asked the finance minister to work out modalities for relieving artisans who had taken finances under this scheme as they have suffered during 2014 floods.
The industry is presently taxed at 12 percent, and the traders, who initially were seeking 5 percent cut, are hopeful that the GST will be cut to 5 percent.
“We have been demanding slashing down of GST from 12 percent and in the Business conclave meeting held on Sunday, I reiterated the demand,” Sheikh Ashiq Hussain, Director on board, Carpet Export and Promotion Council (CEPC).
He said that Finance Minister Dr Haseeb Drabu has promised in the Conclave that he will bat in GST Council for slashing down the tax to 5 percent.
“We have more than 1500 retail outlets in India and the retail business has suffered as well after GST. Given the present situation of business, global position of carpet industry and the GST impact from the last four months, the industry is on decline and the carpet traders have pitched for certain revival packages,” he said.