Guj denim makers to be exempted from entry tax on PTY

Tag : Spandex Yarns

Denim makers have made representations to the state industriesdepartment to do away with the tax. However, state government hasdecided to exempt denim makers from the tax net.
The yarn is mainly sourced from outside Gujarat by thesemanufacturers who end up paying a five per cent additional entrytax on it.
However, it has been learnt that while the entry tax will not beabolished altogether, denim fabric manufacturers will be completedexempted from it.
Since Gujarat had no yarn manufacturers of this speciality, thegovernment had introduced entry tax to discourage outsiders fromselling it in the state and protect the local PTY industry.
The move will save denim players anything from Rs 50 lakh to Rs onecrore per month.
" denim industry had already been suffering from due to inputcosts. An additional tax of five per cent was the last thing wewanted," said Ashish Shah, managing director of Aarvee Denims andExports Ltd.
According to industry players, denim manufacturers in the state buyaround 1,500 tonnes per month of PTY, over 300 denier count andsuper specialty stretch yarn made from Lycra and Spandex.
Kiran Panchal, president (marketing fabrics, apparels and productdevelopment) of Modern Denim Ltd. had also been reeling under highcotton prices. " the yarn manufacturers had increased their pricessubstantially, leading to more losses for us," he added.
Among the major suppliers of PTY and super specialty yarn outsideGujarat include Reliance Industries, Konark Synthetics and IndoRama Synthetics, of which the former two run their units fromSilvassa.