Textile dyeing units in Tirupur have urged the Union government to reduce GST on service provided by CETPs(common effluent treatment plants) from 12% to 5% in the coming budget.
The CETPs were meant for implementation of zero liquid discharge (ZLD) norm in the apparel industry as they would treat effluents sent from the dyeing units and send recycled water to the dyeing units.
In a memorandum submitted to the Union finance minister Nirmala Sitharaman, Dyers Association of Tirupur president S Nagarajan said, “Considering the important role played by CETPs in environmental protection and water conservation, tax was exempted for their service in both occasions in 2005 and 2011 respectively. But when GST was introduced, 18% tax was imposed on the service, and it was later reduced to 12% but we have been insisting the government to make it 5%.”
He said, “12% service tax levy on members of CETPs are non-refundable. Because of this, the processing cost in the dyeing units was increased by 3% to 4%, and subsequently increased the cost of garments manufactured in Tirupur, in comparing to countries like Bangladesh, Vietnam, Sri Lanka and Pakistan, where there is no ZLD system in place.”