'Cut in GST rate on footwear to promote growth'

Leather exporters in the country have urged the finance ministry to reduce in the rate of goods and services tax (GST) on footwear with a view to promote growth of the industry and push exports.

Council for Leather Exports (CLE) Chairman P R Aqeel Ahmed raised this issue at a pre-Budget meeting chaired by Finance Minister Nirmala Sitharaman here on Tuesday.

He said that the domestic footwear sector holds huge potential to create jobs and earn foreign exchange.

"Reduction of GST on footwear would help promote growth of domestic footwear industry," he said in a statement.

The council has sought reduction of GST rate to 12 per on footwear priced above Rs 1,000.

GST rate on footwear worth up to Rs 1,000 was reduced to five per cent, while those above this value still attract a GST rate of 18 per cent.

Currently, export of leather and its products stands at about USD 6 billion. Major export destinations include Europe and the US.

Last year, the commerce minister announced a Rs 2,600 crore package for the leather sector to boost exports.

The sector employs about 42 lakh people.