Cloth merchants in Mumbai have decided to keep their shops shut for a day on June 16 to oppose the Centre’s move of bringing the textile industry under the Goods and Service Tax.

Sixteen associations of cloth merchants from the city and outskirts have formed a Joint Action Committee of Textile Traders Association and decided not to seek GST registration.

Bharat Merchants Chamber, a leading body of textile merchants in the city, says bringing the industry under the GST would hit it badly. It further says GST has been imposed on the textile industry by way of bypassing the existing laws.

The group says the industry is very unorganised and mostly uneducated or poorly educated people are engaged in over 45 lakh looms across the country. Around ten crore people are directly or indirectly involved in the industry. If the GST were to be imposed on the textile industry, it would affect these ten crore people. So it wants the government to do away with its decision to cover the industry under GST.

Textile traders refuse to seek GST registration as the textile industry has always been exempt from any tax under the provisions of the Essential Commodities Act 1957.