The carpet traders of Kashmir are going through the toughest phase in their professional lives. They are of the opinion that the age-old handicraft and carpet industry is witnessing crisis pertaining to its survival since the implementation of GST. Right from job cuts to the cash crunch, every adversity is being attributed to the newly-launched indirect tax regime of the country.
"100 weavers were working with me. Now, there are only 15. It's because after GST, not a single customer or order has come," said Mr Nazir Ahmad Dar, a carpet-weaver who resides in the outskirts of Srinagar.
Handicraft items including carpets were tax free in the Kashmir valley, but in the present situation the weavers will have to pay 12 percent GST. Carpet traders shared their concerns by saying that the burden of the tax will be borne by the poor labourers because 80 percent of the cost is actually in the form of months of hard work being placed by the weavers. "Carpet or shawl is labour-intensive. 20 per cent is raw material and 80 per cent of carpet cost is wages of labourers because it takes a long time to make a carpet. It means you are imposing tax on labourers which is 80 per cent the cost of a carpet. It's unfair," said Vicky Shaw, owner of Shaw Art Palace which is Srinagar’s largest carpet showroom.
Last year, the carpet exporters from the state of Kashmir crossed the revenue threshold of INR 1,100 crore. "We fear in the coming times we may lose this cultural industry from Kashmir. It's a high-value product which is only made in Kashmir," said Mr Ashique, one of the carpet exporters who hasn’t exported a single carpet since the implementation of GST. He’s fearful that the new indirect tax regime will kill the handicraft industry of Kashmir.