Gloom weaves around GST hit Handloom and Handicraft sector

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The Goods and Services Tax revision has done little to ease the worries of the handlooms and handicrafts sellers.

GST continues to cast a shadow over the sales of the handloom and handicraft sector despite the revisions made in the GST council meeting earlier this month.

“Business has come down by 50 per cent since the implementation of GST and has not picked up. It is not every day that people may come out to buy handloom products but we have never seen such a lack of customers,” said Aslam Jhan of Kashmir Cottage Emporium.


Retailers see almost 50 per cent fall in their sales.

The GST on Handlooms is five per cent and on handicrafts,12 per cent. Before the 23rdGST council meet in Guwahati on November 10 this year, the handicrafts and handloom products were under the tax slab of 18 per cent to 28 per cent.

Mir Gohar of Asian Store Cottage Industries Emporium said, “We have to pay taxes twice; once when we bring the merchandise from Kashmir and now here in Bangalore. November has started and this is the time we see maximum number of customers. But compared to last year, our business is down by 30 to 40 per cent.”

The month of September saw a state wide protest over the implementation of GST on handicraft and handloom products which up until then had been exempted from taxes since independence. The main objective of the protest was to call for zero per cent tax on handloom and handicraft goods.
GST has hit the Handloom sales hard


Prasanna, a noted theatre personality, an ex-IITian and founder of Charaka, a handloom cooperative whose products are sold by the brand name Desi, spear-headed the protest which gathered steam and gained support from The Federation of Handloom Organisation and Gram Seva Sangh.

“GST is going to help the vertically integrated industry. The heterogeneous small cottage industry workers are the ones who will truly suffer. Lakhs of people are dependent on handloom and handicraft sales. They will be severely hit,” said Prasanna.

More than 43 lakh people are engaged in the weaving and allied industry according to the handloom census of 2009-10 of the Ministry of Textiles.

The Federation of Handloom Organization signed a petition on change.org for zero per cent tax for all handmade products in the country. The petition has by now been signed by 8000 people supporting the cause for exemption of handloom and handicraft goods from tax slabs.

Prasanna staged a play called Taayavva, in a one-of-a-kind protest against GST where he invited Prime Minister, Narendra Modi and Finance Minsiter, Arun Jaitley. “Ours is a small voice. But someone needs to speak out. The aim for the invitations to the Prime Minister and Finance Minister was to gain their attention and let our voices be heard. It doesn’t matter whether they come or not. But they need to know,” said Prasanna.

“We neither charged GST on the tickets nor paid any. This was our way of protesting against the GST on handlooms and Handicraft. Let them send a notice, this is what we want,” said Abhilash, convenor of Gram Seva Sangha, the organizer of the play.

Himanshu, a chartered accountant of Vasan and Sampath Firm said, “If the revenue of an organization is under 20 lacs a year, then no action will be taken for not paying GST. If not, the tax department can come back to you and will treat the tickets price as inclusive of GST and will recover the same along with interest and penalty thereon.”

Amitesh Bharat Singh, Additional Commissioner of Central Excise said, “We know about the play. The orders of any kind of action have to come from the Principal Commisioner. We are waiting for a meeting.”

The play was staged on November 21, 2017 at ADA theatre, Bangalore.

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