Manufacturers in Kanpur have demanded simplified GST filing process, uniform slab and major reforms by the central government in the upcoming Union Budget.
ith just days before the presentation of Union Budget 2020, manufacturers in Kanpur, Uttar Pradesh have once again expressed displeasure over the continued economic loss that unfolded after the implementation of Goods and Services Tax (GST) and demonetisation across the country.
The implementation of demonetisation and GST badly hit Gurujinder Singh's business who was once a known wooden-product manufacturer and trader in Kanpur.
Earlier, Gurujinder Singh had a staff of more than 30 workers, now he only employs 10 people in his factory.
"The factory was running smoothly before the central government brought demonetisation. This decision was like putting a brake on a high-speed car. Later, the Centre introduced GST without planning, which put the same car on a road full of potholes. GST is very complicated. There are different slabs for wooden products. For bamboo items, the GST is 5 per cent, and for wooden and plywood items GST is 18 per cent. The business declined after the implementation of these two."
"There should be a uniform GST slab for all wooden items and a rate cut in the upcoming budget," demanded Gurujinder Singh.
The manufacturers have demanded simplified GST filing process, uniform slab and major reforms by the central government in the upcoming Budget.
Manufactures and traders at the Hamraj Market, one of the leading wholesale garment markets at the Coperganj area in Kanpur, have seen many ups and downs in business but the present situation, according to them, is the worst.
According to the traders, demonetisation and GST are the reasons behind the ongoing economic loss.
I am in this business since last 16 years but since demonetisation, we have seen an unprecedented slowdown. Earlier, we refused to supply garments to some of the buyers because the demand was very high but post demonetisation the demand has drastically come down. GST has also caused problems in the business. Many of our clients still don't have GST registration. There was a time when I had 100 workers, but now I am only left with a staff of nearly 40 people. We don't hope for a revival even after the Budget but we expect a uniform GST slab and simplified GST filing process from the government, said Dinesh Awasthi who runs a shirt manufacturing unit.
Similar complaints were raised by another garment trader.
This is one of the biggest wholesale markets in Uttar Pradesh but after demonetisation and GST we have seen 50-60 per cent decline in our business, said Vijay Gupta, another garment trader.
"There are hundreds of shops including 70-80 small manufacturing units in our complex. Some people have wound up the garment business after incurring heavy losses due to GST and demonetisation. GST is a complex system which requires a lot of accounting work. Our spending has also increased due to the new taxation system," said Amijat Tandon, a garment trader and president of Hamraj Market association.
"We have been told that in the upcoming Union Budget GST on garments will further increase. If that happens then the situation will deteriorate. At present, there is 5 per cent GST on items costing less than Rs 1, 000 and 12 per cent on items costing more than Rs 1, 000. I appeal to the Finance Minister Nirmala Sitharaman to provide a major relief to the garment sector so that our business can revive. The tax rate should also come down, added Tandon.
While Gyanesh Mishra, general secretary of Akhil Bharatiya Vyapar Mandal stated that demonetisation is the biggest reason behind the decline of Gross Domestic Product (GDP)
There was no need for demonetisation on November 8, 2016. GST was brought in haste. In fact, demonetisation is the biggest reason for declining GDP. Industrialists are migrating from Kanpur. GST portal also does not work properly sometimes and traders are facing a lot of inconveniences, said Gyanesh Mishra, general secretary of Akhil Bharatiya Vyapar Mandal.
The leather economy in Kanpur is also witnessing a slow death after demonetisation, GST and a long shutdown which was ordered by the Yogi Adityanath government ahead of the Kumbh Mela.
In the small scale business, dealings are mostly done in cash. There was very limited cash left for people for many months after the implementation of demonetisation. The small entrepreneurs couldn't revive. Later, the GST was implemented and the state government ordered shutting most of the tanneries ahead of the Kumbh Mela. There was no production for around 13 months and we lost most of our clients, said Haji Abrar, owner of a leather firm.
There was a time when the leather industry in Kanpur used to generate business of Rs 12, 000-15,000 crore every year. Now it has come down to around Rs 4, 000 crore. Major international clients have started importing leather from Bangladesh, Pakistan and Indonesia because they don't trust us any more. We only want the government to allow us to operate our manufacturing units without any obstruction, the vice-president of Small Tanneries Association Raj Singh Yadav.
Published On : 26-01-2020
Source : India Today
