T.N. Powerloom Federation welcomes GST cut on yarn and polyester

By Admin

06 Sep, 2025

The Federation of Tamil Nadu Powerloom Associations has warmly welcomed the Union government’s decision to reduce Goods and Services Tax (GST) on yarn, polyester, and related materials from 12% to 5%. This move is seen as a lifeline for weavers and textile workers across the state and country who have long been burdened by high input costs.

In a joint statement, State president L.K.M. Suresh and secretary R. Velusamy expressed their gratitude to Prime Minister Narendra Modi, Union Finance Minister Nirmala Sitharaman, Chief Minister M.K. Stalin, and State Finance Minister Thangam Thennarasu for facilitating this reduction and extending much-needed support to the sector.

A boost for Tamil Nadu’s weavers

The federation highlighted that after agriculture, the handloom industry is the largest employment provider in Tamil Nadu, with over 20 lakh weavers depending on more than six lakh handlooms. Across India, nearly 25 lakh handlooms provide livelihoods to over 70 lakh people. However, the sector had been struggling due to rising input costs, especially the 7% tax burden on yarn purchased at 12% GST. Since input tax credit could only be claimed after a delay of three to four months, many weavers faced financial strain and limited cash flow.

Relief from financial pressure

According to the federation, the GST reduction will significantly ease the financial pressure on weavers. It will enable them to purchase raw materials more smoothly, sustain production, and avoid disruptions in work. Importantly, this decision will help revive an industry that was edging toward decline and unlock investment that had previously been tied up in input tax credits.

Role of the State government

The federation also extended thanks to the Tamil Nadu government for actively supporting their demand and ensuring it was presented at the GST Council meeting. They acknowledged the contribution of Chief Minister M.K. Stalin, Finance Minister Thangam Thennarasu, and Minister for Housing, Prohibition and Excise S. Muthusamy for standing by the handloom community and amplifying their concerns at the national level.

A step towards revival

With this decision, the central and state governments have taken an important step toward sustaining one of India’s oldest and most culturally significant industries. By easing the tax burden, the move not only secures livelihoods for millions of weavers but also strengthens the textile sector’s contribution to the economy. The GST cut is expected to encourage greater production, investment, and stability in the handloom and powerloom industries, setting the stage for long-term growth.