Paper industry appeals to PM Modi: Calls for GST revision
The Federation of Paper Traders’ Associations of India (FPTA) has sent an appeal to Prime Minister Narendra Modi, expressing concern over the recent increase in Goods and Services Tax (GST) on Paper & Paperboard (Chapter 48) from 12% to 18%. The letter, signed by Mehul Mehta, the president of FPTA, highlights the negative impact of this decision on the entire paper industry and its associated livelihoods.
06 Sep 2025 | 328 Views | By Dibyajyoti Sarma
In his letter to the Prime Minister, Mehta emphasised that paper is not a luxury item but an essential commodity crucial for education, hygiene, and packaging. He noted that the sector directly employs over half a million people and indirectly supports nearly two million livelihoods across India.
The FPTA had anticipated a reduction in GST to 5%, which they believed would boost demand and employment. Instead, the current 18% GST is expected to burden end-users, reduce consumption, and create stress throughout the value chain.
A key point of contention raised by the FPTA is the "confusion regarding differential GST treatment." The letter points out that the same grade of paper used for exercise books, notebooks, and maps is exempt from GST (0%), while it incurs 18% GST if used for printing, calendars, diaries, and posters. Mehta argued that it is practically impossible to differentiate the end-use of paper at the point of sale, leading to ambiguity, potential malpractice, and risks for genuine traders and manufacturers.
The FPTA has requested the Prime Minister's intervention to clarify the mechanism for usage differentiation and to consider placing both paper and finished notebooks/exercise books under a uniform 5% GST slab for simplicity and transparency.
Furthermore, the FPTA highlighted the "inverted duty structure" impacting the packaging and printing sector. Under the revised GST rates, several printing and carton-making activities under Chapter 48 attract 5% GST, while their raw material (paper) is taxed at 18%. This disparity, according to the FPTA, leads to significant GST refunds being locked up, putting severe working capital pressure on small and medium converters, printers, and traders.
The letter concluded with an appeal, reminding the Prime Minister that paper is a medium of education and knowledge, revered in Indian culture. The FPTA has requested an audience with the Prime Minister to present their concerns in detail and to reconsider placing Chapter 48 – Paper & Paperboard under the 5% GST slab. The association believes that timely government intervention will bring relief to thousands of paper traders, printers, and converters across India and ensure the continued growth of this vital sector.