Garment exporters express concern over increase in Service Tax
New Delhi, Mar 2 (UNI) Garment exporters today expressed concern over increase in Service Tax from 10 to 12 per cent in the Budget 2006-07 saying it would create further financial burden on exporters as most of them were not covered under CENVAT.
Garment Exporters Association (GEA) in a statement said the Finance Minister should have restfained from hiking Service Tax by 2 per cent to 12 per cent and relieved the exporters from the extra burden.
GEA President Sudhir Kharabanda pointed out ''that the Budget has not provided adequate necessary fiscal relief to the exporting community.'' Mr Kharabanda, therefore, urged the Government to provide a suitable package of incentives including higher duty drawback rates, adequate and need-based funds to exporters at a reasonable rate of interest and assured labour reforms with flexible laws to prepare the Indian textile industry for the new quota-free environment GEA President, however, complimented Union Finance Minister P.Chidambaram for announcing several positive proposals for the textiles industry.
Mr Kharabanda hoped that increased allocation for Technology Upgradation Fund (TUF) which has been enhanced from Rs 435 crore to Rs 535 crore and the Rs 189-crore provision for the Scheme for Integrated Textiles Parks (SITP) will promote investment in textile industry.
Reduction of excise duty on all man-made fibre yarn and filament yarn from 16 per cent to 8 per cent and import duty on all man-made fibres and yarns from 15 per cent to 10 per cent were also steps in the right direction and would improve price competitiveness of Indian products, he added.
UNI BBS SD RN1455