Apparel Sector MSMEs Welcomed Union Budget, But Expected More from Finance Minister
H K L Magu, Chairman, Apparel Export Promotion Council welcomed the reduction in corporate tax for SMEs with turnover up to Rs. 250 Cr.
Responding to the proposals made in the budget for the textile sector comprising of a fair share of Micro, Small and Medium Enterprises (MSMEs), Apparel Export Promotion Council has raised that the budget only partially addresses the concerns of the industry.
“The industry is happy for the increase in the budget allocations for the apparel package to Rs. 7148 Cr. We hope that this will improve RoSL reimbursement, which has dried up since June, 2017”, AEPC said in a release.
The apparel industry is a women oriented industry – the reduction in the women’s contribution to EPF to 8% from the present 12% will encourage women participation in this sector further, the release further added.
Explaining the concerns of the sector further, AEPC said that the apparel industry was one of the worst hit after demonetisation and GST roll out, as a huge part of the supply chain was outside the tax regime before GST.
The industry is presently grappling with severe financial crunch due to the non-receipt of GST refunds and RoSL refunds besides other procedural issues towards transition to GST. The industry was hoping for some financial support for mitigating the financial crunch, especially because the sector also saw severe reduction in the drawback and RoSL benefits.
The industry is looking forward to increased interest subvention from the existing 3% to 6%, to help industry be competitive, as several other countries have much lower interest rates, the release added.