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Gujarat government to abolish tax on narrow fabrics

Following representation from industry association, the 5 per cent value-added tax (VAT) on narrow fabrics manufactured in Gujarat, may soon go. This would most likely be in the man-made fabric (MMF) hub of Surat.

During a meeting at Gandhinagar with Saurabh Patel, Minister of State for Finance, the decision was conveyed to the industry through Jitu Vakharia, President, South Gujarat Textile Processors Association (SGTPA). During the State Budget in February, 2015 the Gujarat government had imposed 5 per cent VAT on narrow fabrics.

There are about 300 small and big manufacturers of narrow fabrics in Surat itself. Surat and Ahmedabad are the two big centres for arrow fabrics in the state. Around Rs 150 crores worth of narrow fabrics is supplied to various garment manufacturing hubs across the country per year, according to estimates.

The fabrics are used in orthopedical industries, car industries, apparel industries, orthopedical industries, electronic industries, and several others. Vakharia stated that these fabrics in other states had not VAT and it was applicable to fabrics manufactured in Gujarat. He added that the industry as concerned that Gujarat manufacturers would lose their business because of the tax and the SGTPA had made representation to the state government to abolish it, he added.

 
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