GST’ is the buzzing hot topic of today that is creating a churn of discussions surrounded by chaos, confusions, fears and even bright hopes though the real picture will be revealed after its practical implementation. In wood panel trade, few are extremely happy, many are uncertain and majority are clueless.
Distributors and dealers have almost stopped stocking as a result the material inventory in markets be it for plywood, laminates, PB or MDF, ACP or Door, is reduced to 50 percent. It is certain that after 15 days of GST everyone will ask for quick deliveries to fulfil the gap. “One Nation One Tax” is favourable in long term but has brought panic and fear of survival among industries. New rules of compliance, regulations and systems are still unknown to masses hence uncertain business environment is bound to shake the demand or payment cycle for several months.
There are people who still believe that ‘past practices will be continued probably’. My sincere advice is to make a ‘do or die effort’ for 18% and take an oath for 100% billing culture to make the wood industry and trade a respectful contributor to GDP which is mandatory to build our great nation as well as our businesses.
Majority of finished items in wood article are covered under 28 percent e.g. plywood, plyboard, doors, flooring, particle board, MDF etc, where as 18% GST applies on Laminates, PVC Boards, ACP, Sawn timber, etc. Majority of raw materials e.g. plantation logs, face veneers, chemicals, foils etc fall under 18% slab. The slab of 28 is posing a big threat for sustainability for 2500 units in plywood industry where as GST at 18% would have been an appropriate, logical with respect to increased tax collection and growth. Undoubtedly, SSI limit of 1.5 Cr has been more of a shield for thriving unorganised wood units who paid almost nothing as excise tax so far (irony is, they limited themselves from growth that was possible) thus GST is very much needed.
“28% slab on plywood, door and board category is like punishing a child for failing in exam where he was never given the right teaching environment or even a school.”
The high slab of 28 is a weapon of mass destruction that itself defy the government push for manufacturing in India. However, 28% slab is a big boost for top brands, slight struggle for semi & mid brands but serious threat to the small ones. There are people who still believe that ‘past practices will be continued probably’. My sincere advice is to make a ‘do or die effort’ for 18% and take an oath for 100% billing culture to make the wood industry and trade a respectful contributor to GDP which is mandatory to build our great nation as well as our businesses.
The Ply Reporter has been always writing, speaking and motivating every stakeholder of industry to work in organised manner. But when time has come and the industry is open to changes, why a high slab of 28% is levied and burdened upon “a trade that employs 10 lacs of workers, lacs of carpenters, lacs of retailers and thousands of small furniture units who will die instead of contributing to India’s growth story?”
Let’s pray and hope GST on wood article reduces to 18%.