Shilparamam artisans clueless about impact of GST

Despite earning below Rs 20 lakh, they have to register under new tax regime as dealers comply with GST
Customers buying handicrafts at Shilparamam in Hyderabad on Monday  | vinay madapu
Customers buying handicrafts at Shilparamam in Hyderabad on Monday | vinay madapu

HYDERABAD: Despite earning less than `20 lakh a year, and thus being exempted from the Goods and Service Tax (GST) ambit, artisans at Shilparamam will have to register with GST. Reason being, all their raw material dealers are GST compliant, hence dragging them into the GST network. Almost all traders are clueless about the particulars of GST though they are aware of the need to get themselves registered in order to continue business.

Take the case of M Naiq, a 43-year-old handloom trader from Karnataka, whose women’s ethnic clothing shop at Shilparamam does not generate a bill. He visits Kothapet market four times a year to buy cloth material and purchases ready-made garment from Rajasthan. The payments are made either by cash or cheque. This transaction too, is unbilled. 


However, now under the new tax regime, Naiq will find soon find it difficult to source cloth material for his handcrafted textile shop. The GST compliant trader will be unable to sell to Naiq, who is not GST complaint.It’s not that Naiq is not ready to register with GST. However, the digital nuance is not his cup of tea. “I do not keep track of how many items I sell a month (a must for GST compliance). I heard others say that I will need to keep track of everything I sell but I don’t have a computer nor do I know how to use one,” said Naiq. Though not GST-compliant at present, Naiq knows he will need to get on-board the GST train to stay in business.

Confusion rules the roost
The handicrafts sector has been taxed at 12 pc and textiles at 5 pc. Though sector wise tax slabs had come out in June, several traders are still uncertain about the category they fall under. “For Kashmiri shawls and sarees, I buy material from Srinagar and my family does the embroidery work. So would I fall under two tax brackets?” wondered Parveez Kashmiri who operates a textile stall at Shilparamam .


Tax relief for this informal sector at Shilparamam will only be in the form of rent. “We will bear the 18 per cent GST on rental. As for what they sell here, the traders will have to deal with it themselves,” said a senior official with the tourism department.

Other problems
Owing to the Strategic Road Development Plan (SRDP) to construct multi-layer flyovers at 20 key junctions in the city, a vast number of stalls are facing temporary closure for the flyover work.  This will affect the 290 artisans at Shilparamam Earlier in April, Serilingampally Tahsildar evicted 33 traders from Shilparamam night bazaar for illegal occupation

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