Four days after the Goods and Services Tax (GST) came into effect, the trader community is still grappling with the change and looking for answers to many of its queries. Traders from the Mangaldas Market in Kalbadevi said there is a lot of confusion among them over GST, its process and its impact on their businesses. “Our business has been hit badly in the last few days. Though it is the slack season with the wedding season and Ramzan over, there are absolutely no transactions now. To bear daily office expenses, we just hope there are one or two transactions in a day so that we don’t need to spend from our pockets for it. I have never seen this kind of a business situation in the last few decades,” said Pawan Dhanuka, of Chiku Miku collection.
Not only have loyal customers decreased but the number of traders coming from outside the city have also reduced significantly. It would be sometime for business to pick up, he added. Another trader said they are more worried about the old stock. “Nobody is purchasing the new stock. Many of us don’t know what to do with the old stock. So everyone is knocking the chartered accountant’s door. GST has set businesses back by around 20 per cent,” said the trader from 5th Lane.
He said it had been said earlier that GST would be levied on those goods which were then taxed. There was no tax on clothes earlier, he said. The government has put three different slabs on textiles under GST — while there is a 5 per cent GST on cotton fibre, yarn and fabric, man-made fibre and yarn will attract 8 per cent GST. Besides, all apparels will attract 12 per cent GST but apparels below Rs 1,000 will attract 5 per cent GST.
Dhirendra Sanghani, of Dimpi Collection, said, “Whenever a new system is introduced, there is some resistance from people. So, there is confusion among the traders about existing stock and the GST to be levied on it. GST will affect those traders who were doing some transactions in black. It will put an end to those transactions as everything will be tracked now.” Sanghani has been in the clothes business for 58 years.
However, Ashraf Ali, a trader in Crawford Market, said his business has taken a major hit. “My business has been reduced from couple of thousands to just a few hundred in the last four days. I don’t know what to do in the new tax regime. As we were recovering from the repercussions of demonetisation, GST has dealt another blow,” said Ashraf, who runs a cosmetic shop.