Perfect Sourcing - March 2016

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TAXATION- A CHALLENGE FOR THE APPAREL INDUSTRY..

Few days back a fellow exporter friend forwarded me a message which said hey god.. please give me the strength to pay Income Tax, VAT, CST, Service Tax, Excise Duty, Customs Duty, TDS, ESI, Property Tax, Stamp Duty, Water Tax, Professional Tax, STT, Hafta, Donations, Wealth Tax, etc. and if I have some money left after that I will do business.

The message was sent in good humor, but if I see closely it is really becoming a headache for a common man and also a businessman to operate smoothly.

The Union Budget 2016-17 presented by finance minister Arun Jaitley has been a cause of concern for apparel retailers of India as the budget proposes to bring in high- end readymade garments under excise duty net leaving the manufacturers in a difficult situation.

As per the Union Budget,2% excise duty will be levied on branded readymade garments and made-up articles exceeding Rs 1,000 or more.

However, this duty will be applicable only for those manufacturers who do not claim input tax credit (ITC) popularly known as central value added tax (Cenvat) paid on various raw materials.

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