GST Revisions: Paper Traders Cite Issues, Elevator Makers Push for Tax Cuts

Fast Summary

• The GST Council announced a rate rationalization for various goods effective September 22, triggering concerns from paper merchants adn elevator manufacturers in Telangana.
• Telangana paper Merchants’ Association (TPMA), representing around 250 members, has requested the reduction of GST on paper and boards from 18% to 5%. They argue that taxing raw materials at higher rates while exempting finished products like notebooks (0% GST) can disrupt working capital and inflate education costs for students.
• TPMA highlighted risks such as classification disputes, litigation threats, and potential malpractices from misclassifying notebook papers due to varied GST rates across the supply chain-ranging from 0%, 5%, to 18%.
• The Telangana Elevator Association (TEA) appealed for lowering the existing 18% GST on elevators for individual buyers, stating it hinders affordability of elevators as basic amenities.
• TEA also proposed a state-level Lift Act in Telangana to regulate industry operations and enforce safety standards. Nearly 5,000 elevator units are installed monthly by TEA members in Telangana and Andhra Pradesh at an average cost of ₹8 lakh per unit.

Indian Opinion Analysis
The concerns raised by the TPMA underscore key challenges with multi-bracket tax structures under GST. Charging different tax percentages on raw materials versus end-products can create inefficiencies in claiming Input Tax Credit (ITC) while increasing costs throughout production chains. This issue affects industries like publishing substantially when products related to core services like education are involved.Misclassification risks could further exacerbate compliance burdens.

The appeal by TEA reflects broader implications of uniform tax levies irrespective of buyer type-hindering accessibility for individual households often constrained financially compared to developers purchasing at scale. Introducing a dedicated Lift act appears pragmatic as it not only focuses on cost but also emphasizes operational safety standards critical for end-users.

Both cases highlight potential areas where revisiting GST policies could bring practical relief while addressing systemic inefficiencies within these industries essential to societal progress.

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