Why wholesalers and retailers are opposing GST in some parts of India?

Ever since the Modi government announced its decision implementing GST or Goods and Services Tax in India, there has been considerable controversy as to its necessity as well as the way that it is being done. While the imposition of GST has affected almost all business sectors of the country, the clothing manufacturing, wholesaling, supplying and retail sectors have probably taken the most hit. The wholesalers and retailers associated with the clothing industry in India have already protested the 5% Goods and Services Tax and are taking major steps to make sure that their voices are heard through the length and breadth of the country. Just a few days ago, wholesale textile merchants in Kanpur chose to shut down their shops and business centers to commence a 3-day strike against the GST that they consider to be completely unfair.

Thousands of shops all across the country were kept closed in the recent times as a form of protest against the GST. The wholesale textile market dealers were also supported by the online wholesalers who form an integral part of the clothing industry of this country. Most agree to the fact that the new tax laws as set by the GST regime is totally unacceptable for them as that would force them to sell their clothing products at higher cost prices. This would naturally hit their business in a bad way as the customers would be disappointed with the higher prices that they have to pay. It would negatively impact their business as their overall sales would reduce significantly. Moreover, they are also likely to face stiff competition from larger clothing brands that have more ready capital in hand to deal with such financial changes.

Wholesalers and retailers are opposing GST
Wholesalers and retailers are opposing GST

The traders also chose to show their discontent with the new GST laws and protested by carrying out marches in different parts of the country. They also urged the retailers to shut down their shops to show support for their cause, which they readily did. There have been active protests in different parts of the country and pleas to change the current GST laws since many fear that it would seriously affect small business owners in India who are associated with the clothing manufacturing, retailing and wholesaling industries. In the past few weeks, many well known markets in India that are known to be major commercial hubs for buying and selling of clothes were found to be more or less deserted. This was not only observed in prominent areas but also in smaller markets as well.

Earlier there were hardly any taxes levied on wholesalers and retailers associated with the business of selling cloth. On the other hand, most of the taxes were levied from the manufacturing firms who are responsible for creating different types of finished clothing products. However, the new tax regime is not only going to make it difficult for the wholesalers and retailers to do their business but also make it difficult for the manufacturers to secure higher number of sales. Currently many experts believe that the situation is likely to worsen in a few months as sales are going to go down from multiple levels. The ones who will be most badly affected include the medium and small cloth merchants. With the rising competition, they will find it to be more and more difficult to carry out their business as before and secure profits for themselves. Many will be forced to permanently close their businesses and try out other means to earn their daily wages. Although the GST laws have already been implemented, many retailers and wholesalers are still continuing with the protests as they believe that over time their efforts can bear fruit, with important changes being made at the GST tax policies.

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