Micro units in Coimbatore struggle to pay GST interest

 









Several micro units in Coimbatore recently received notice asking them to pay interest on the GST remittances that were made after the due date.

J. James, president of Tamil Nadu Association of Cottage and Tiny Enterprises, told The Hindu that the units have been asked to pay interest amount from 2017 for late payment of GST. For some units this works out to ₹ 50,000 to ₹ 1 lakh too.

With the steep hike in raw material prices, the larger industries here have slowed down the job works given to the vendor units. The micro units do job work for larger units and are struggling to survive as there are hardly any orders in the last few weeks. In such a situation, the notice of payment of interest for GST is almost impossible for these units.

The micro units operate with less margin and get payments for the work done in 90 to 120 days.


And, even if the GST is paid one day late, the units need to pay a late fee. Charging interest on it with retrospective effect has pushed the micro units to a difficult situation. The units have been asked to make the payment immediately, he claimed.

Mr. James said the interest amount should not be collected from the micro units.



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