12% GST payable on Footwear of Sale Value not exceeding Rs.1000 per pair: CBIC [Read Notification]

The Central Board of Indirect Taxes and Customs (CBIC) notified the 12% GST payable on Footwear of sale value not exceeding Rs.1000 per pair.

There is an increase in the GST rate on footwear to 12% from 5% earlier, which will be effective from January 1, 2022. At present, 5% GST is charged on the sale value of up to Rs 1,000 per pair.

The rate changes will provide clarity to the industry and settle, once and for all, the issues caused by the inverted duty structure.

The fitment committee has proposed increasing the rate on footwear having sale value less than Rs 1000 to 12% from 5%. These rate changes are scheduled to be implemented with effect from 01.01.2022.

AAR Ruling

The Customs Authority of Advance Ruling (AAR), Mumbai while ruling on the application filed by the M/s Skechers South Asia Private Ltd noted that in the 45th GST Council meeting GST rate changes in order to correct inverted duty structure in footwear were discussed. The fitment committee has proposed increasing the rate on footwear having sale value less than Rs 1000 to 12% from 5%. These rate changes are scheduled to be implemented with effect from 01.01.2022. Therefore, the present ruling will be valid till such changes in the GST rate are implemented.

To Read the full text of the Order CLICK HERE

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