The Clothing Manufacturers Association of India (CMAI) has warned that the proposed GST hike on garments priced above Rs 2,500 could severely impact the apparel sector already battling the effects of global tariff wars.
According to reports, the GST Council is considering increasing the rate on garments above Rs 2,500 from the current 12% to 18%. CMAI has called this move a “death-knell” for an industry that employs more than 12 million Indians, many of them women and semi-skilled workers.
CMAI stated that the hike would hit the aspiring middle class and organized garment manufacturers the hardest. The association highlighted that garments priced higher are not always luxury products but often reflect higher raw material costs and handwork.
For example, woolen garments, essential in North, North-East, and East India, usually cost between Rs 3,500 and Rs 7,000. Similarly, wedding attire often starts at Rs 10,000–15,000, even for middle-class families. Traditional, artisan-made clothing also tends to cross the Rs 2,500 mark due to the time and craftsmanship involved. CMAI cautioned that imposing an 18% GST would not only burden consumers but also threaten traditional crafts and artisan livelihoods.
The association also warned that such a tax structure could push parts of the apparel sector back into the informal economy, undoing years of effort by both industry and government to formalise it.
With the sector already under pressure from US tariff wars, CMAI has urged Prime Minister Narendra Modi to intervene to prevent further damage.
“The garment industry is the lifeline of India’s textile heritage,” CMAI said, adding that the proposed change could cripple a sector vital to employment and domestic growth.
