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GST on Kashmiri Shawl: Will Kashmiri shawls remain a dream for common people? This is being said because the Central Government has decided to include Kashmiri shawls and other handicrafts in the “luxury” item list. Under the new scale, GST on handicrafts worth more than Rs 10,000 will be increased from 12 to 28 per cent, making them considered luxury items.
And if the government accepts the new proposed tax slab on Kashmiri handicrafts, alarm bells may ring on the famous Kashmiri Pashmina shawls. This proposal has been placed for discussion in the 55th GST Council meeting to be held in Jaisalmer today i.e. 21st December.
The Group of Ministers (GoM) on rate rationalization led by Bihar Deputy Chief Minister Samrat Chaudhary has recommended a dramatic increase in GST rates on cashmere shawls, crewel items and other textile products for goods worth more than Rs 10,000. The tax will increase from the current 12 percent to 28 percent.
The handicrafts sector provides direct and indirect employment to more than 3 lakh artisans, many of whom are women and from marginalized communities as shawl making is a highly labour-intensive process.
Traders and artisans say that instead of promoting Kashmir shawls, the Group of Ministers in the GST Council has proposed increasing the tax, which will cast a long, scary shadow on the artisans and dealers who have carefully preserved this exquisite craft for generations. Have done.
Under the proposed scheme, Kashmir shawls have been placed in this category based on the misconception that Kashmir shawls worth more than Rs 10,000 are a luxury item and hence are charged the highest penal rate to reduce consumption in this category. Tax should be imposed.
Former Finance Minister Haseeb Drabu said, “The rate band of 28 percent, the highest band, is a punitive rate aimed at reducing consumption of “demerit” goods.” He said that imposing 28 percent tax on Kashmiri shawls is harming the integrity of the GST rate system.
Kashmir Chamber of Commerce and Industry (KCCI) President Javed Ahmed Tenga said the implications of this proposed increase are extremely worrying as Kashmiri shawls are not a luxury item. “Artisans invest extensive manual skills and time to create unique, handmade objects that generate more than 75 percent of their value through labor-intensive processes,” Tenga said.
“Dealers in the sector are particularly concerned about the tax implications when supplying products from Kashmir to the national markets and the proposed tax structure effectively amounts to destroying the capital of small and medium enterprises that support the artisanal ecosystem of Kashmir. “Can permanently destabilize the system.”
In an attractive letter addressed to the Industries and Commerce Commissioner Secretary, the Directorate of Handicrafts of Jammu and Kashmir has also stressed on the significant nature of the proposed tax change. The letter states,
“The Pashmina industry is an iconic part of the heritage of Jammu and Kashmir, known for its delicate craftsmanship and labor-intensive processes. Each piece of Pashmina represents months of meticulous hand-weaving by skilled artisans, among whom “Many are women from rural and remote areas.”
The letter further warned: “The proposed increase in GST from 12 per cent to 28 per cent for pashmina products priced above Rs 10,000 threatens the survival of this fragile industry. If implemented, it would Not only will the livelihood of the artisans be in danger, but an important aspect of the cultural heritage of Jammu and Kashmir will also be destroyed.”
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