The Central government had proposed 28 % GST on Plywood and other wood panel products e.g Particle board, MDF, Doors and Decorative plywood products starting from July 1, 2017 that shocked the whole wood panel industry and trade in India. The most surprising was decorative laminate coming under 18 percent slab despite of being a designer item. This announcement shook the panel industry across sectors who then formed groups at state levels and associations to present a case for 18 percent or lower slab. The efforts to reach out to government for consideration in reduction united the plywood industry at whole new level and increased communication within states. The announcement of 28 percent got implemented from july 1st and was effective till 15th November 2017. This period was very tough and uncertain for the industry and trade as they witnessed increased working capital needs and dull demand with some negative sentiments among buyers towards wood and furniture products.
The high tax slab also impacted the objective of GST because many turned back to the old ways expressing incapability to pay high amount under 28% GST. Different Plywood Associations and their members of Plywood manufacturers in states e.g. UP, Uttarakhand, Haryana, Punjab, Gujarat etc. repeatedly met their respective states ministers, central ministers, higher finance department officials in states and after four and half months the GST could be reduced to 18%. The decision from 28 to 18 % GST was the most awaited and most talked subject for the whole panel industry that ultimately got success hence paving way for a big boost for organized plywood manufacturers.
The change from 28 % to 18 % is a significant step towards organized and formal work culture on wood panel based industry. Now there are many producers who were willing to become organized but could not are preparing to be on the formal work practices hence boosting the prospects for higher spending on marketing, advertising, branding etc. The implementation of GST at 18 % is one of the most important and vital mention under Turning point of the year because of one simple reason – it is the beginning of a roaring all new work culture in wood panel furniture manufacturing sector.