gst on job work related to textiles

[pawan agrawal]

On 5th aug council meeting GSt reduced from 18% to 5% on Textiles job work related to man made yarn. I want to know whether GST RATE IS NOW 5% ON DYEING JOB OF MAN MADE YARN earlier it was 18%.

AND what will be GST rate ON PACKING AND CHECKING JOB, CLIPPING JOB WORK ON TEXTILES. because these job mostly used labour to do work.

[Himansu Sekhar]

Let us for the notification

[KASTURI SETHI]

Job work of all kinds of textile is covered.

[KASTURI SETHI]

My reply amended. Pl. read all kind of job work to textile. There are selected types of textile.

[pawan agrawal]

Sir,

Not understood what will be GST rate ON PACKING AND CHECKING JOB, CLIPPING JOB WORK ON TEXTILES. because these job mostly used labour to do work. I think it will be 5% because it is a job work related to textiles but officer saying since it is 18% because it is labour service.

[KASTURI SETHI]

When we say job work, it includes all kinds of job work. Labour is an integral part of job work. So many processes are involved in textile like heating, calendering, dyeing, stentering etc. Labour work cannot be segregated from job work for arriving at different rate of duty. I agree with you for 5 % rate. Packing etc. Mentioned by you also attract the rate of 5% as goods cannot be sold or cannot become marketable or we may say cannot be supplied without the processes mentioned by you. Labour and processes both are ingredients of job work. So no question of segregation for the purpose of higher rate of tax on some part of the goods. See also the definition of transaction value.

AI Summary

GST on textile job work treated at a lower rate because labour and processes are inseparable. GST on textile job work is treated as a single category covering dyeing, stentering, heating, calendering and similar processes; labour is an integral part of job work and cannot be separated for a higher rate. Ancillary services such as packing, checking and clipping necessary to make goods marketable are included within job work and receive the same tax treatment. Transaction value principles apply in assessing value for taxation.