Union Finance Minister Nirmala Sitharaman on Friday said the Goods and Services Tax (GST) Council has decided to defer the decision to increase tax on textiles from 5% to 12%.
The decision to maintain status quo on the GST rate on textiles was taken in an “emergency meeting” of the GST Council held in the national capital under the chairmanship of the Union Finance Minister. “We retain the status quo. We have decided don’t go from 5% to 12%,” Sitharaman said in a media briefing after the GST Council meeting.
Sitharaman said the issue of GST on textiles will be sent to the tax rate rationalisation committee, which will submit the report by February.
“Textile was the only issue in this meeting,” the Finance Minister said, adding the issue of the increase in GST on footwear was not discussed during the meeting.
The GST Council in a meeting held on September 17 in Lucknow had decided to hike GST on textiles and footwear items from 5% to 12% effective from January 1, 2022.
This was the 46th meeting of the GST Council under the chairmanship of Union Finance Minister Nirmala Sitharaman. Finance Ministers of states and union territories and senior officials attended the meeting held at Vigyan Bhawan in New Delhi. Union Ministers of State in the Ministry of Finance, Pankaj Chaudhary and Bhagwat Kishanrao Karad, besides senior officials in the Ministry of Finance, attended the meeting.
The meeting holds significance as it took place ahead of the Union Budget for 2022-23, which is scheduled to be presented in Parliament on 1 February 2022.