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Gst Fall Out

PLY NEWS | JULY 2017

GST FALL OUT :

WOOD PANEL INDUSTRY IS NOT FULLY PREPARED

F

ollowing the historic tax reform to be rolled out on July 1, the wood panel industry is reported to be confused, fearful, and slightly hopeful for a better future. The 1 st July is set to welcome the fully GST-implemented Indian market, which has put a question mark over the existence of small-scale wood sectors. In the wood industry, few are looking for a better change, and a majority are uncertain and clueless.

Given the fact that new rules of compliance, systems and regulations are going to be effective from the next month, however this new set of rules is unintroduced to masses and small and mid-sized business that are associated with the wood industry. Consequently, uncertain business environment is bound to ask for full payment before July 1.


Not only this, the distributors and dealers have also become reluctant to the stock market, which has led to slow down the laminates, plywood, MDF, PB, Door, ACP market.


“One Nation One Tax’ can be a good move in long term, but currently has brought fear and panic of survival in the industries. Till the GST is practically implemented, it’s difficult to see its real picture”, said an industry expert, on promise of being anonymous.

To be precise, a majority of finished items in wood article like plyboard, doors, plywood, floorings, etc. which are the primary needs of building materials are covered under 28% slab whereas 18% GST has been levied on PVC boards, Laminates, ACP, Swan timber, etc. In addition, a majority of raw materials which include face veneers, plantation logs, chemicals, foils and many other come under the 18% GST slab.


The 28% GST category is a direct hit on the backbone of at least 3000 units in the plywood industry. It is a slight struggle for semi & mid businesses whereas a grave risk for small ones. The high slab of 28% is like a heavy burden imposed upon a trade that employs lacs of workers, carpenters, labourers, retailers and small furniture units.


Though the long-awaited initiative of ‘Goods and Services Tax’ is to be put into practice from July, it seems the wood industry is not fully prepared to accept it. As a result, many appear to end their business in the mid-way instead of being able to contribute to the country’s growth.

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