FW
The Goods and Services Tax (GST) Council on Saturday cleared the pending rules for the rollout of the new indirect tax regime from July 1.Finance Minister Arun Jaitley chaired the 15th meeting of the GST Council, where the rates of tax and cess on gold, biscuits, footwear and textiles were decided:
Highlights of GST for various sectors of textiles, apparel and footwear:
• GST council has levied tax on textiles such as yarn and fabric cotton at the lower slab of 5%
• GST of 12 per cent will be levied on readymade garments. However, apparel under Rs 1,000 will attract a 5 per cent levy.
• Manmade fibre will be taxed at 5 per cent, while synthetic fibre will attract an 18 per cent GST.
• Jute and Silk have been exempted from GST.
• The GST Council has fixed the tax rate on footwear worth up to Rs 500 at the lowest tax slab of 5% under the new GST regime, The GST tax rate on footwear costing more than Rs 500 is fixed at the higher 18%
• Other than this, it levied cess over and above the 28% tax on certain luxury goods and sin goods. A section of industry is saying that differential treatment for cotton and synthetic fibre on GST rate is an opportunity lost for a uniform rate for textile sector.
The government has fixed a 5 per cent GST rate on cotton fibre, yarn and fabric against the current prevailing rate of “nil”. This means, cotton yarn and fabric would now attract 5 per cent duty, which would make all products proportionately costlier. Some states, however, had levied value added tax on cotton yarn and fabric at 2-4 per cent. Overall, 5 per cent GST levy is higher than the existing levies on cotton yarn and fabric. Silk and jute have been kept under “nil” category under the GST. Man-made or synthetic fibre yarn will attract 18 per cent GST.
While all apparels would attract 12 per cent GST once the tax is rolled out, against the current levy of 6-7 per cent, apparels below worth Rs 1,000 would levy 5 per cent GST.
“We are happy with the government’s decision to keep fabric under 5 per cent and apparel under 12 per cent,” said R K Dalmia, President, Century Textiles.
While announcing these rates, the Finance Minister Arun Jaitley, however, clarified that textiles manufacturer would not given credit outflow. This means, an input credit above the prescribed limit would not be granted to textiles manufactures, said Jaitley.
He said this in the context of 18 per cent GST for man-made yarn, while fabric made from that will attract 5 per cent and hence full input credit will not be utilised.
S C Kapur, chairman of association of synthetic fibre industry said, "The government should have appiled a uniform rate to the textile industry which has been the global practice. Man-made fibre tax at cotton yarn level would have helped higher investment in the sector. Additional demand for fabric can be fulfilled by synthetic makers as there will always be an upper limit to produce more cotton."
Synthetic yarn and cotton yarn blended fabric constitutes 70-80 per cent of total fabric and hence mis-declaring synthetic fibre as cotton in blended fabric is not ruled out, say industry captains.
With this, readymade garments would become costlier proportionately. Had input credit been granted, garments manufacturers would get a breather in terms of taxes on raw materials.
“The 5 per cent GST levy on cotton yarn and fabric would make interstate movement of goods smoother and business would become transparent. A small increase in the product rate would become immaterial once business goes with uniform tax rates across the country. Meanwhile, the rate of 12 per cent for textiles is progressive and will lead to the growth and development of the entire value chain,” said Ujwal Lahoti, Chairman of The Cotton Textiles Export Promotion Council (Texprocil).
The GST rate for textiles will eliminate the cascading effect of duty/taxes which will reduce the costs and improve the competitiveness of the textiles exports.
“Five per cent GST on cotton yarn and fabrics would help producers with compliance and encourage farmers to grow more cotton, Lahoti added.
With this low rate, Indian producers would become competitive in the world which will help India’s textiles exports grow in coming years, a senior industry official said.
"A credit transfer document will be issued to the manufacturer. If the tax on the item is below 18 percent, 40 percent of the Central or State GST payable will be given as credit. For items with tax above 18 percent, 60 percent will be available as credit," said Revenue Secretary Dr. Hasmukh Adhia during the press briefing.
Southern India Mills Association (SIMA) today hailed the Goods and Services Tax (GST) rates announced for the textile industry. As the textile industry has been under the optional route since 2004 and the fabrics have been under zero VAT rate, the 5 per cent GST rate would bring substantial revenue apart from widely broadbasing the tax net across the textile value chain and ensuring compliance, SIMA chairman M Senthilkumar said.
The 5 per cent GST on readymade garments below Rs. 1000 would greatly benefit the common man across the country, being a mass consumption item.
SIMA chief has stated that 5 per cent GST rate on cotton fibre would sustain the competitiveness of over 20 million cotton farmers as this rate across the value chain would enable the cotton textile industry to remain globally competitive, achieve substantial growth rate and increase cotton fibre consumption and thereby increase the earnings of the farmers.
He expressed hope that the textile job work would be exempted from service tax which is essential to benefit the industry, especially the powerloom sector, knitting, processing and garmenting sectors.
Senthilkumar said that 18 per cent GST rate levied on man-made fibre and synthetic yarn would have inverted duty structure problem as the fabric would attract only 5 per cent GST rate.
Genetic engineering, innovations in tillage, and changes in farm size and efficiency have combined to reduce cotton’s impact on the environment over the past 35 years.
Cotton farming has evolved from horses to robots and drones. Great improvements have been made in reduced soil loss, water use, and pesticide use.
Measuring evapo transpiration offers real-time information to help schedule irrigation.
Plus these environmental improvements have not been at the expense of production. From the ‘60s until now, cotton farmers have almost doubled the amount of cotton they grow with no more acreage.
Commercial cotton breeding has created new varieties that produce more lint. Integrated pest management programs allow producers to be more precise in targeting insect pests. And those pesticides are more selective, targeting specific insects, diseases or weeds. Now, selective pesticides preserve beneficial insects like lady bugs.
Reduced tillage systems are helping conserve moisture, increase organic matter in the soil and limit water and wind erosion.
Biotechnology now protects plants from insect damage. Herbicide tolerant varieties also allow a more efficient weed management system. Cotton farmers also reduce energy consumption because of biotech.
Genetic engineering has improved varieties in other ways. Cotton is already known for drought tolerance. It requires significantly less water than corn, wheat or rice.
Domestic prices of cotton in Brazil have oscillated in May, but ended the month with a slight increase.During the month, the CEPEA/ESALQ Index, eight-day payment terms, for cotton type 41-4, delivered in São Paulo, increased 0.52 per cent.
In general, liquidity was low in May. Quotes were underpinned by the firm position of sellers in the off-season period and by the devaluation of the currency against the dollar, mainly in the second fortnight of the month.
In addition to lower cotton availability in the spot market, the gap between asking and bidding prices also contributed to limited trade.
Based on estimates for a good 2016-17 harvesting, some processors expect prices to drop and hence were interested in buying only small volumes to meet their short-term needs.
For the anticipated trade of the new season, the gap between asking and bidding prices has been wide as well.
However, the pace of export trade was faster in May, mainly for shipments in 2018 (2017-18 crop). International price rises, mainly in mid-May, encouraged agents to close new contracts and/or fix prices for open contracts.
Brazilian cotton prices climbed in the first fortnight of January 2017, primarily driven by low availability, coming from the failure of the 2015-16 crop and since most production from that crop was traded in advance.
A&E makes continued improvements, specifically in global water reduction and zero-waste-to-landfill efforts. The group has recycled and reused over 1.1 billion liters of waste water since 2013. Nearly one million liters of waste water are recycled and reused each day of operation. There has been a 41 per cent reduction in global water consumption since 2006 in its operations.
American & Efird is a manufacturer of industrial and consumer sewing thread, embroidery thread, and technical textiles.
A core part of its business strategy is to operate all of its global facilities in a sustainable manner. The group has managed a six per cent reduction of global carbon footprint since 2006 while 44 per cent of the fuels used to create steam at A&E dyeing operations were renewable and carbon neutral in 2016. There has been a ten per cent reduction in global power consumption at the group since 2006.
A&E continues to focus on energy conservation and has increased its use of bio fuels and clean fuels, resulting in reductions in greenhouse gas emissions. In addition, A&E has grown its number of global operations and support facilities to 16 in achieving zero-waste-to-landfill status.
A&E regularly evaluates all of the global yarn spinning, dyeing and finishing facilities in which the company has ownership.
"DMA Textile Care, Fabric and Leather Technologies to extend its support for one of the leading International Trade Fair for Technical Textiles and Nonwovens -Techtextil India. It will work up to increase its scope into the garment machinery segment this year. Working together with the VDMA Textile Care, Fabric and Leather Technologies, the organizer plans to capitalize on this market need and deliver a specialized platform that is completely focused on business requirements of the Indian market."
DMA Textile Care, Fabric and Leather Technologies to extend its support for one of the leading International Trade Fair for Technical Textiles and Nonwovens -Techtextil India. It will work up to increase its scope into the garment machinery segment this year. Working together with the VDMA Textile Care, Fabric and Leather Technologies, the organizer plans to capitalize on this market need and deliver a specialized platform that is completely focused on business requirements of the Indian market.
This launch has even drawn attention of the buyers from India’s largest garmenting associations Apparel Export promotion Council and Clothing manufacturing of India both of these have shown their support to this plan. These associations are planning to visit the fair to recognize the developments and get new technologies to their members.
The support demonstrates the hugeprospective for trade and technology transfer between Indian and German companies they will target the increasing demand and manufacturing emphasis of the garment and textiles industry in India.
India being one of the major producers of garments international, the demand for automation solutions is increasing says Elgar Straub, Managing Director of VDMA Textile Care.
India is the second major textile manufacturing capacity globally with the textile machinery sector witnessing a growth of 8-10 percent year on year leading in apparel consumption as well as inexports. It is definitely, giving growth to computerization garmenting processes to move in the Indian market.
Giving importance to the launch of Texprocess Pavilion has increased with themajor machinery importers IIGM and E H Turel, Mehala already on board. According to the Pavan Kapoor, Managing Director, IIGM India's diverse markets are rightly positioned to manufacture, consume and export non-traditional textile products. Products that are not related to apparelhave diverse applications in geo thermal, wind, automotive, process industries, health care and technical textile etc compared to the traditional methods of manufacturing adissimilar technologies is needed for such industry related products.
He further adds that besides leaning about the applications of these newer technologies, these segments of business would surpass the requirement of traditional textile and leather products.
Discussions are also under-way with a lot of companies to bring in a mix of international expertise in technical textiles and technologies on one platform.
Texprocess and Techtextil in India will bringanoutstanding showcase that will cover the completeprice chain in the fields of technical textiles, nonwovens, apparel textiles and apparel and textile technology. The market for technical textiles is growing and demand for processing technologies is also increasing.
Digital Print Week US will be held June 5 to 9, 2017.It will feature Digital Textile Printing US, slated for June 8 to 9, 2017. Digital Textile Printing will bring together an audience that will span the entire supply chain, including a range of textile printers, end users and a supporting supply chain in technology providers.
Discussion at the conference will focus on the drivers for digital textile printing, including sustainability, personalization and mass customization, while exploring additional applications for digital textile printing and technical advances in the market.
Digital Print Week US will bring together a lineup of more than 50 presentations from nearly 60 experts across five days of case studies, four panel discussions and networking opportunities.
Digital Print Week US will focus on the latest innovations and applications for 3D printing, new case studies and examples in commercial scale digital package printing and exciting new developments in the high-growth digital textile industry.
Smithers Pira has been running the Digital Print for Packaging US conference since 2010. Given the event’s growth, the company is expanding into the tangential market of digital textiles.
The digital textile industry is forecast to become a 2.6 billion dollar market by 2021.
Brand licensor Marquee Brands is leading a consortium that is preparing a bid for BCBG Max Azria, which would allow the US fashion house to exit bankruptcy with a footprint of 15 to 20 stores.
The move could spare BCBG the fate of other bankrupt retailers who have completely gone out of business and sold their brands, such as The Limited Stores, American Apparel and Wet Seal.
BCBG, which is owned by investment firm Guggenheim Partners, filed for bankruptcy in March after it fell behind in rent payments and struggled with a debt load of about 485 million dollars.
Marquee has partnered with Global Brands Group Holding, a spin-off of global exporter Li & Fung, which already has a licensing agreement for some of BCBG's brands.
The consortium plans to make a stalking horse bid for BCBG that would set the floor for any other proposals in a bankruptcy auction for the retailer to be held as soon as this month.
Marquee owns British menswear brand Ben Sherman, surf line Body Glove and Bruno Magli, an Italian fashion line.
Global Brands in April sold a majority stake of The Frye Company brand, known for its cowboy boots, to brand licensor Authentic Brands Group for 100 million dollars. Global Brands continues to operate Frye’s retail stores and e-commerce.
For the first quarter of this year Lululemon Athletica’s net revenue rose five per cent compared to the first quarter of last year. Lululemon Athletica is a Canadian athletic apparel retailer.
Total comparable sales decreased one per cent. Direct to consumer net revenue was flat. Gross profit was up seven per cent compared to the first quarter of fiscal 2016. Adjusted gross profit was up ten per cent from last year. Income from operations was down 21 per cent compared to the first quarter of fiscal 2016. Adjusted income from operations was up ten per cent.
The company will operate Ivivva, its active wear brand for girls, primarily as an e-commerce-focused business with a select number of stores in key communities across North America.
It plans to close approximately 40 of its 55 Ivivva stores and convert approximately half of the remaining stores to Lululemon branded stores. The retailer will also close all of its Ivivva branded showrooms and other temporary locations, and will streamline its corporate infrastructure.
The closures and restructuring may substantially be completed by the end of the third quarter of fiscal 2017. The company remains focused on owning its position as the global brand defining an active, mindful lifestyle.
Leading fashion brands are a part of Fashion Positive Plus. This collaboration works to accelerate the development of safer, circular materials for use in the apparel industry.
The members include H&M, Kering, Loomstate, Zero + Maria Cornejo and Eileen Fisher. They have begun the process of identifying building block materials, such as fibers, yarns, finishings, trims, and dyes that the group will collaboratively work to optimize for material health, safety and circularity.
The aim of Fashion Positive Plus is to convene some of the biggest brands and brightest design innovators in the world to collaborate on accelerating the optimization and availability of positive, circular building block materials for the fashion industry.
Plus will focus on driving the improvement of commonly used materials with the highest potential to positively impact human and environmental health and, in the process, catalyze systemic change for the fashion industry.
Fashion Positive Plus is a part of the Cradle to Cradle Products Innovation Institute. This institute is dedicated to advancing the verification of positive materials for the circular economy across many sectors from building materials and interior design finishes to packaging, personal care, household products, textiles and apparel.
Through Plus, it’s possible for brands to achieve a whole range of circular materials that they can put into the market within a very short time, including yarns, fabrics and trimmings.
"With exhibitors from 12 countries, four unique seminars and workshops, and a bigger ‘Trend Zone’ with a brand new ‘Information Exchange Zone’, the 6th edition of the BD Expo marked another leap forward. Highlighting the importance of developing business relationships and promoting best working practices, the 6th edition of Bangladesh Denim Expo was held on May 17 at the International Convention City Bashundhara, Dhaka."
With exhibitors from 12 countries, four unique seminars and workshops, and a bigger ‘Trend Zone’ with a brand new ‘Information Exchange Zone’, the 6th edition of the BD Expo marked another leap forward. Highlighting the importance of developing business relationships and promoting best working practices, the 6th edition of Bangladesh Denim Expo was held on May 17 at the International Convention City Bashundhara, Dhaka. The theme of the two-day expo was ‘Denim Networks’, underlying the strategic importance for global market to strengthen long-term relationships and mutual approach, especially on innovation and sustainability.
Numbers speak growth
The sixth edition saw a total of 58 exhibitors from 12 countries – Bangladesh, Brazil, China, Germany, Hong Kong, India, Italy, Japan, Pakistan, San Marino, Spain and Turkey displaying their products and actively participating in the main theme of the show that registered over 5,545 visitors from 1,029 companies and 52 countries as well, confirming the constant growth in audience numbers since the beginning. Starting with 10,000 online registered visitors, the organisers expressed their satisfaction for having attracted a bigger crowd than expected, considering the usual gap. In this edition, a total of four informative seminars and workshops on trends, innovation and new technologies, global denim market and quality assurance were also held.
Informative seminars
Themed, ‘From ideas to technologies: discovering a new age for garment finishing’, the seminar focussed on new trends in finishing, embracing cultural, economic and technical considerations. ‘A/W 2018/19 Trend Seminar by WGSN’, an extensive presentation by the specialists from the renowned trend forecaster WGSN, covered the mood board, key looks and silhouettes for women and men, color, fit, construction, wash and trim direction identified for four main mega trends. At the ‘Garmon SPA Seminar’, Marco Nava, Global Sales Director, Garmon Chemicals, unveiled the sustainability-oriented approach of Garmon Chemicals. They are the advanced chemical supplier for apparel world that provides worldwide fashion players with solutions that give wearers exactly what they ask for – garments enhanced by modern and beautiful fashion treatments that are safe for them and for the planet.
In another seminar, ‘Total quality assurance olistic approach for business excellence’ Karthik ND, Country Managing Director, Intertek, shared thoughts on holistic approach for business excellence with the opportunity for direct interaction with the expert. WGSN held trend forecast and workshop all-day their dedicated booth in Hall 4 mezzanine in the Trend zone area.
Trend zone a hit
At the ‘Trend Zone’, an unique space dedicated to showcase latest denim trends and innovative products, visitors were able to gain insights on denim fabrics, styling and finishing available in Bangladesh, together with an offer of the most relevant denim publication. The 6th edition featured several special event-displays that captured the attention of all denim lovers. Amongst them: ‘Tonello Denim Gallery’, Selfie Booth by Sportswear Magazine and Trend Zone were the most attractive.
Sustainability on the agenda
A-not-to-be-missed appointment during the event was the Sustainable Apparel Forum (SAF), organised by Bangladesh Apparel Exchange (BAE), under the theme ‘Mmaking sustainability easier’. Through four unique knowledge sessions, the forum explored several key issues aimed at making sustainability easier to implement by factories and individuals. Topics such as ‘saving water, resources & cost – The must-knows for your factories’; ‘energy efficiency – how to optimise energy consumption and reduce cost’; ‘green factories’; and ‘sustainable financing’ were brought to light for attendees.
