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Saturday, July 13, 2024

The tax rate for TIERI textile and leather retailers raised to 18 percent

The TIER-I retailers in the textile and leather products sector will face a higher tax slab in the upcoming fiscal year (FY25) as the government has increased the tax rate from 15 percent to 18 percent.

This proposed tax rate will mainly apply to expensive and branded products textiles and leather. The budget speech emphasized that this tax is being imposed on the class that can afford to buy these expensive items.

Moreover, it mentioned that this hike would not affect the common man. To elaborate on the textile industry’s performance in Q1 2024, it is worth mentioning the sector grappled with challenges in both domestic and export markets.

Domestically, high energy costs, costly financing, and the imposition of government taxation escalated the cost of doing business. Additionally, the global economic slowdown subdued demand for textile products in the international market. Accordingly, overall exports of the textile industry remained stagnant.

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