India Shoe Industry Urges The Government To Lower The Tax Rate Of Shoes And Enhance Competitiveness

Whereas industry The competitive advantage has been losing to the low cost countries such as China, Vietnam and Kampuchea. India's domestic footwear industry urges the finance minister to reduce the excise tax on footwear products to ensure the survival of the industry.

"Higher cargo tax makes India shoes less competitive, and ultimately leads to a decline in the number of shoes made in India. Over the past 3 years, the number of shoes imported from China, Vietnam and Kampuchea has increased by 300%. The representative of India footwear manufacturers and Retailers Association (AIFMRA) said.

　　 association The representative said that India's shoes need to pay between 12% to 15% value-added tax and 2% to 5% of the market tax, but also to pay 8% of the goods tax, become the most demanding products of the highest taxes.

they think Since the necessities such as food and clothing do not need to pay the goods tax, shoes belonging to the category of necessities should be exempted from the tax, rather than the same tax on goods such as mobile phones, motorcycles or automobiles.

The high tax rate has greatly weakened the enthusiasm of shoemaking in India, and has also hindered the growth and modernization of shoemaking industry. Although demand for shoes is growing in India consumers, most of the shoe products that meet these needs come from imports. A shoe manufacturer in India said that China now supplies 60% of the world's shoes, while India's output is only 1/6 of China's.

Although the government's budget stipulates that shoes priced below 1000 rupees can be exempt from goods tax, the positive effects are limited. Because only a small number of shoes will be priced below 1000 rupees. Considering the high market tax, gross margin, discount and logistics cost, the price of each pair of shoes will be above 1000 rupees.

AIFMRA believes that a reasonable tax on footwear products can create 4 million jobs, and the footwear industry will attract 100 billion rupees in the next four years.