Fabric 5%. Apparel ≤ ₹1000: 5%, > ₹1000: 12%. Job work 5%. Handloom concessional. Inverted duty structure ITC refund. Export zero-rated (LUT).
TEXTILE GST: (1) FABRIC (cotton, silk, synthetic): 5%. (2) APPAREL/GARMENTS up to ₹1,000: 5%. (3) APPAREL above ₹1,000: 12%. (4) YARN: 5-12% by type. (5) MADE-UPS (bedsheets, towels): 5-12%. (6) JOB WORK (textile): 5%. (7) HANDLOOM: 5% (concessional). KEY THRESHOLD: ₹1,000 per piece for garments determines 5% vs 12%. EXAMPLE: ₹1,500 shirt = 12% GST = ₹180.
APPAREL ₹1,000 RULE: (1) Per piece SALE VALUE ≤ ₹1,000: 5% GST. (2) Per piece > ₹1,000: 12% GST. (3) Threshold based on SALE PRICE (not cost). (4) BRANDED premium apparel: usually 12%. (5) MASS-MARKET budget clothing: often 5%. EXAMPLE: (a) ₹800 t-shirt: 5% = ₹40. (b) ₹2,000 jeans: 12% = ₹240. STRATEGIC: pricing near ₹1,000 — factor GST jump. Retailers price strategically around threshold.
INVERTED DUTY STRUCTURE (textiles): (1) INPUTS (yarn, dyes, chemicals) taxed HIGHER (12-18%) than OUTPUT (fabric 5%). (2) Creates ITC ACCUMULATION (input GST > output GST). (3) REFUND available for accumulated ITC. (4) GST RFD-01 application. (5) Was a major issue — partially addressed by rate rationalization. STRATEGIC: textile manufacturers claim inverted duty refund. Maintain detailed input-output records. ENGAGE textile GST CA for refund claims.
TEXTILE JOB WORK: (1) JOB WORK (dyeing, printing, stitching for others): 5% GST. (2) PRINCIPAL sends material, job worker processes. (3) ITC available. HANDLOOM + KHADI: (1) 5% concessional (some exemptions). (2) Handloom promotion. (3) Khadi (KVIC): special treatment. POWERLOOM: standard rates. STRATEGIC: job work units benefit from 5% rate + ITC. Handloom weavers + cooperatives get concessions. Document job work challans (Form ITC-04).
TEXTILE GST STRATEGY: (1) APPAREL pricing: factor ₹1,000 threshold (5% vs 12%). (2) INVERTED DUTY: claim ITC refund (RFD-01). (3) JOB WORK: 5% + ITC. (4) E-WAY BILL for inter-state. (5) E-INVOICING > ₹5cr turnover. (6) COMPOSITION scheme for small (< ₹1.5cr): 1% (traders) / 5% (manufacturers). (7) HANDLOOM concessions. (8) EXPORT: zero-rated (LUT) — major for textile exporters. (9) FABRIC 5% uniform. (10) ENGAGE textile-specialist GST CA. India textile sector huge — GST compliance critical for manufacturers, exporters, retailers.