GST tweaks: paper merchants flag anomalies, elevator makers seek lowering of levy for households

Days after the Goods and Services Tax (GST) Council announced a rate rationalisation exercise, effective September 22, paper merchants and elevator manufacturers in Telangana have flagged issues, specifically anomalies in the levy on certain products and need to lower tax or provide exemption to individual buyers of elevators respectively.

Telangana Paper Merchants’ Association, a 250 member body and a part of the All India Federation of Paper Traders Association, wants GST on paper and boards to be reduced from 18% to 5%. This is not a concession but a corrective necessity, TPMA president Abhishek Vijayawargi said, adding otherwise the move will increase education costs for students.

A major concern is the anomalous GST treatment given to notebooks, textbooks and the paper used in their production. Notebooks are exempted (0% GST), while paper used to manufacture notebook titles will attract 18%. With finished product nil-rated and basic raw material taxed publishers and notebook makers will not be able to claim ITC resulting in working capital locked up and higher costs, he said.

Paper manufacturers sell all paper at 18% GST, but it is impossible to pre-identify which paper will end up in notebooks. This will lead to misclassification and malpractice and put genuine businesses at risk while rewarding loopholes, Mr.Vijayawargi said.

With the paper sector set to attract levy under 0%, 5%, 18%, as opposed to 12% prior to revision, mills, traders, printers and publishers will be forced to deal with classification disputes, litigation risk and harassment from authorities, TPMA said in a release.

Relook 18% GST on lifts

Telangana Elevator Association leaders at a meeting in Hyderabad on Tuesday

The Telangana Elevator Association (TEA), a body of small and medium-sized elevator manufacturers, in its appeal has urged the Centre to reconsider existing 18% GST on elevators for individual buyers. President of the association Challa Avinash said with the levy same for builders purchasing elevators for their projects and households/individual buyers, the latter’s accessibility and affordability to an facility that is fast becoming a basic amenity is reduced.

The TEA also wants Telangana government to introduce a dedicated Lift Act to streamline industry operations, set clear safety standards and enhance quality assurance for end-users. Nearly 5,000 elevator units are installed every month at an average cost of ₹8 lakh per unit by the association members in Telangana and Andhra Pradesh.