New Delhi, Oct 9 (KNN) With the Goods and Services Tax (GST) entering its fourth month since implementation, the differential tax rate on job work continues to haunt the Micro, Small and Medium Enterprises (MSMEs) in the gems and jewellery sector, All India Gems & Jewellery Trade Federation informed.

Talking to KNN, Ashok Minawala, Spokesperson of All India Gems & Jewellery Trade Federation (GJF) informed that the main hurdle over in transition from the previous tax regime to the Goods and Services tax still needs to be addressed.

Explaining the problem, Minawala informed that there is a differential tax issue on the job workers in case it is from within the state and outside the state.  In case of it being from outside the state, there is a levy of 18 per cent GST, whereas the tax rate on it within the state attracts a GST of 5 per cent.

This differential tax rate is contrary to the essence of the GST’s One Nation One Tax motto, Minawala informed.

He further said that this phenomenon is also proving to be an obstacle towards the ease of doing business in the country.

Minawala said while the sector is successfully adapting the newly introduced tax system, this concern needs to be addressed with priority.

“We have given multiple representations, and we expected it to be brought up in the recent meeting of the GST council, but a response in the line is yet to come” he added.

The gems and jewellery sector has started to come to its feet under the Goods and Services tax regime and things are easing up for the sector, Minawala informed. (KNN/ DA)