The proposed Goods and Service Tax (GST) with high rate of taxes has come as a severe blow to the granite industry, which is already in crisis with the decline in the exports to the international markets, in the undivided Karimnagar district.
The GST Council, which met in Srinagar, had announced a tax of 28 % on the polished granite and 12 % on the raw blocks.
Currently, the finished polished granite tax structure is only 2 % and the raw granite is charged at 14.5 %. With the proposed imposition of 28 % of GST on the polished granite, which moves fast in the domestic market, the industry would run into doldrums, opined owners of the granite polishing units.
Several granite polish units are struggling to run the business following the decline in exports. With the imposition of 28 % tax on the polished product, the market would collapse completely as the cost of the finished granite would escalate burdening the customer. If the cost is increased, the customer would not prefer local polished granite and instead prefer the cheaper tiles coming from China, they observed. There are around 223 granite polishing units and another 160 granite quarries in the area. More than 50 % of the quarries have shut down their business following the closure of exports to China and now the GST would force the units to close and deny employment to several thousands of workers.
Sri Venkatesh Granites director Arjun Karwa said that the Government should rethink about the imposition of 28% GST on polished granite for the survival of the industry.
When the Government had reduced the GST for raw granite blocks, why not for the polished granite, he asked and suggested that it be fixed between 5% and 12%. Karimnagar District Granite Quarry Owners’ Association president Rachakonda Tirupathi Goud said that the steep hike of GST on polished granite had come as a rude shock to the industry. The industry would be closed if the Government sticks to its stand, he said and appealed to the government to reduce the tax to 12 per cent.
