Textile sector hails exemption of service tax on cotton transport

YarnsandFibers News Bureau 2014-07-12 14:50:00 – Chennai

Indian Cotton Federation hails over the announcement made in the budget, exempting of service tax on loading, unloading, packing, storage or warehousing, transport by vessel, rail or road (GTA), of cotton, ginned or baled. It is a welcome move and in the right direction.


T Rajkumar chairman, Southern India Mills’ Association, has also welcomed the announcement of exempting cotton transport loading and unloading services from the purview of service tax. The mills source more than 70% of their raw material from Gujarat, Maharashtra and other states and Tamil Nadu has been sourcing more that 95% of the cotton from other states. This move would give a considerable relief to the industry and also to the cotton farmers.


Further, T Rajkumar said that extending the optional Cenvat for textiles, one of the demands of the industry till GST is implemented will ensure a level playing field. The optional route is in vogue from July 9, 2004 which has helped the industry to achieve a significant growth rate though it had to face recession in 2008-2009 and 2010-11.


India’s textiles and clothing industry is one of the mainstays of the national economy. It is also one of the largest contributing sectors of India’s exports worldwide and employing over 105 million people are optimistic about the Budget proposals.

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