Indian Zipper Industry Appeals to GST Council


SHOCKING! -SAVE THE ZIPPER INDUSTRY! - Members appeal to GST Council to reduce GST

In a letter dated 26th of October, 2017, Zippers Association of India has requested the Chairman of the GST Council to consider some of their demands. These were to Include slide fasteners and parts thereof as a part of Textile Industry, to lower the tariffs on fasteners (tariff item - 9607) to bring it on par with those of common man’s textile items i.e. @ 12% from the existing rate of 18%, to seek personal appointment with the chairman of GST council at the earliest to allow them to appraise him of their concerns.

Already considered a sick industry, Zipper manufacturing provides employment to about 1 lac workers who are majorly women. The demand has been made in the light of problems being faced by the already ailing sector due to the implementation of GST and its impact on the business of slide fasteners and apparel export industries.

It has become essential for the industry to take a step forward and request the GST council under Ministry of finance to bring down the existing tariffs on zippers and parts to 12% at par with textile industry because of many reasons. One, the existing tax rate of 18% is too high and unjust in comparison to that on textile items which is 5% or 12%. Also, Indian Zipper Industry Appeals to GST Council has been suffering not due to its capabilities but due to inconsistencies in terms and policies. The lowering of tariffs will provide the fastener as well as apparel export industry with competitive edge in the existing quota free world.

Local manufacturing and supply of zippers will shorten delivery time, boost export orders and enhance brand reputation of the garment export industry. If government takes this move, it’ll help retaining and generating employment of especially women. The decision will also minimize the loss of turnover and government revenue collections. Till date, more than 25 units in the Zipper industry have been closed because of the GST blow. To save the already dying industry, the employers are leaving no stone unturned.

The rationale behind the demand and previous policies revolves around the fact that the government policy towards fastener industry has been lacking consistency both in terms of technicality and regulations. Time and again, it has seen many flip flops. The reason for this inconsistency has been the
lack of appreciation of its uses and permanency in regulations.

Almost 80% of all zippers is used in textile industries and more than 95% of the inputs used as raw materials in their manufacture are textile items, taxed at 12%. Zippers, that happen to be one of the most popular in textile industry - thanks to them being inexpensive and convenient, are taxed at 18%.

Indian Zipper Industry Appeals to GST Council of finance ministers on VAT in its meeting dated 05th January, 2005 treated them as industrial input of readymade garments industry and levied VAT at the same rate as them. Technical advisory and monitoring committee (TAMC) of Technology upgradation fund scheme (TUFS) included zippers under TUFS scheme in their meeting on 9th May, 2006.

The Finance Bill, 2007-08 decided to treat zippers under textile industry and reduced excise duty on them accordingly, from 16% to 8%. The Finance Act 2012-13 increased excise duty to 12% again.

Indian Zipper Industry Appeals to GST Council are an integral part of textile and apparel industry. They are used in the manufacture of readymade garment, woolen products, hosiery products, jackets, gloves, windcheaters and covers of pillows, mattresses, quilts and blankets etc. They are mostly made from textile materials like polyester or monofilament yarn, thread, tape etc.

The Zippers Association of India is the umbrella organization of zipper manufacturers throughout the
country. It seeks to build a platform where the manufacturers can share their concerns and be heard as a single body.

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