A body of furniture makers and dealers in Telangana apprehends that the 28% levy on their products under Goods and Services Tax (GST) regime will sound the death knell for many units.
The tax rate threatens the existence of many of the units, most of them small and unorganised, All Telangana Furniture Manufacturers and Dealers Association president Satish Batcha said on Wednesday.
He was speaking on conclusion of a 72-hour bandh called by the association against the GST levy. The association wants the State government to take up their case with the Centre.
Noting that units made furniture as well as household articles such as sofas, cots, dining tables and almirahs besides office furniture, he said though the products were meant for the common man it has attracted the highest GST tax slab. Wood, steel and plastics form the basic raw material for the products. At present, most of the items attract a VAT of 14.5%, while on some the rate is 5%, he said, adding that labour charges account for 60% of the production cost.
Apart from not being easy to pass on the GST levy to the customer, the new rate would also make many of the manufacturers uncompetitive. Several of the units also undertake third-party manufacturing, Mr. Batcha said.
Stating that a rally was taken out from Nampally to Abids, via Moazzam Jahi market, as part of the bandh, he said the association would like to wait for sometime and in the event of no response from the government intensify its agitation.
