Hit hard by 28% GST slab, say producers

KOCHI: Rubber wood based plywood manufacturers have said 28% goods and services tax slapped on the industry has hit it hard even before it could recover from the crisis after demonetisation.

“Majority of the plywood manufacturers have a turnover below Rs 1.5 crore. We were selling plywood made of rubber wood to dealers outside the state at 2% central sales tax against C form. That, with the 14.5 % value added tax, would bring the total tax to 16.5%. It is 11.5 percentage points higher now,’’ said Jose Chacko, owner of Delta Plywoods & Boards at Perumbavoor near Kochi, which houses about 400 plywood units.

Bigger manufacturers have not been affected since they were already paying about 27% tax earlier.

Haryana and Kerala account for two of the biggest plywood manufacturing clusters in the country. Plywood is used mainly for interior designing in buildings and for making packing cases and cable drums.