Free Press Journal

GST impact: Fashion designers face taxing times


Tapapriya Lahiri delves into the problems faced by fashion designers, after being hit by GST levy of 12% on couture, and how they are choosing other economical options

Donning in designer clothes adds an oomph factor to your personality, and fashion lovers are always in search of that impeccable finished product to stand out in crowd. It was never easy to dole out a handsome sum on designer clothes, but the recently implemented Goods and Services Tax (GST) has made it more painful for the fashionistas and designers alike. There is a huge outcry among the couturiers ahead of festive and wedding season, as high-end designer clothes have fallen under the radar of 12% GST, which use to attract only 5% earlier. As the entire high-end fashion market becomes ‘cost-sensitive’, designers are chalking out plan-B to make their clients happy while keeping three components in mind — competitive pricing, superior quality and quintessential designs.

To flag off their new clothing line under the stringent rules of GST many fashion designers have analysed the market and thought of introducing simple, chic yet elegant clothing lines for festive and weddings.

A Amit Sachdeva Creation

On restraining pocket pinch

Generally at the onset of wedding season, the designers are inundated with orders but this time they are going awry about the steep hike. Instead of brainstorming on designs, hemlines, cuts and silhouettes, designers are busy sharing their plights on how to restrain the market from being getting affected further. Kolkata-based Agnimitra Paul says, “Among all the cities, Kolkata is worst hit by the hefty tax burden. Here, fashion lovers can’t shed exorbitant amount to buy designer clothes and I will never be able to compromise on the quality of the product. Hereby, it is extremely unfavourable to launch intricate designs, as more you incorporate quirky designs in the outfit, the more it will cost. So, I have planned to keep my collections very simple with minimalist details. The situation is very intense to deal with the price-sensitive market.”

To counter the GST challenge, Delhi-based designer Amit Sachdeva says, “In the beginning of the season, I am unable to resonate with a new GST taxation. When it’s a time to showcase my skills, I have to keep my designer instincts aside and strategise to make the pricing competitive and affordable for the consumers to fill the gap and make clothing more impactful and value for money, so that customers won’t feel the brunt. Before the festive season starts, we are nervous about the tax transition, but at the same time, we’re also following what the government has levied.”

Similarly, designer duo of label Faabiiana of Jaipur, Kusum and Karishma are posing similar thoughts after implementation of GST. The duo adds, “As our work involves weaving international inspiration and traditional sensibilities into clothing, it requires immense cost to roll out a finished product. We are tad tensed, how to manage the situation before the wedding season starts and as we all know Jaipur is one of the most preferred place to conduct big-fat weddings.”

Handloom to the rescue

When the designers and consumers are talking about GST levied on made-to-order and prêt-à- porter outfits, handloom fabrics come as a saviour as the Centre has not imposed any tax on it. Hereby, couturiers are planning to introduce some unique and intrinsic nuances on handloom clothing lines. Sachdeva says, “I am considering handloom fabrics as a silver lining, and formulating to introduce handloom line-ups, even in wedding collections. Amid all the criticisms and negativities that the new tax regime is drawing, I would say it’s a good initiative by the government think-tanks by exempting handloom fabrics from GST radar and an exceptional way of promoting Indian handlooms in the world market.” He further adds, “Over a period of time I have realised that being a designer, I should focus on hand-woven finished products, even on big-fat wedding attires.”

Paul agrees and says, “After learning about enormous tax impositions under GST, I am preparing to launch my exclusive line-up of handloom collections this festive season. Now it became easier to source all the handloom fabrics from the suppliers as it is not attracting GST and as a designer, I can give the best shot and meet clients’ expectations. Especially, I am fond of Odisha handloom Ikkat, and right now I have started working on it.”

Priyanka Ella Lorena Lama, a new-age Bengaluru-based fashion designer, who loves to showcase her hand-woven collection says, “I am happy that the government have exempted handloom fabrics from GST and this time, I am eager to launch swanky and elegant handloom collections to brave the tax imposition. As per my market perception, only hand-woven finished products can be brought under the light of competitive pricing while maintaining the quality.”

A design by Kusum and Karishma from the label Faabiiana

Shoppers’ confessions

 It’s well imbibed in our thoughts that ‘shop till you drop’ and it seems not likely to be possible in GST era at least for the high-end clothing line-ups. Shoppers have changed their minds and have altered shopping lists too for their D-Days. Oindri Ghosh, who was very excited to start shopping for her wedding, says, “After 12% tax levied on high-end designer outfits, there is a bit shift in my shopping list. Shedding big bucks on statement outfits will surely make a hole in my pocket and I had to opt for something that is affordable, yet has a chic appeal.”