CHENNAI: The Indian Society of Lighting Engineers (ISLE) on Tuesday urged the government to cut the prevailing GST rates for LED lamps, LED luminaires and solar system components such as batteries to five per cent. This, ISLE said, would help the lighting industry source local components from domestic manufacturers at less price. This would also patch up pitfalls through restructuring and adoption of proper mechanism between organised and unorganised sectors.
The government had earlier fixed 12 per cent GST for LED lamps and fixtures including LED driver and MCPCB (Metal Core Printed Circuit Board). This put players in the unorganised sector, who are not tax-compliant and who account for 45 per cent in the domestic lighting market, at a better position thanks to the cost advantage vis-a-vis competitors. ISLE also said that a separate code for components such as connecting wires, PCBs, driver and the likes “creates confusion” among players.
“If there are so many sub classifications, there has to be clarity,” said Dilip Kumbhat, national president, ISLE. This could also lead to illegal manufacture of bulbs and import of cheap components from China in order to evade pertinent taxes.
Kumbhat added, “Though the GST rate of 12 per cent on LEDs are in line with the campaign to combat climate change, the fixing of GST on Fluorescent tubular lamps and compact fluorescent lamps looks exorbitant.”