Waste cotton traders in the State have sought removal of market cess on the product. R. Senthil, co-ordinator of the waste cotton traders’ association, said raw cotton attacts 1 % cess in the State and waste cotton also attracts 1 % market cess.
After the implementation of Goods and Services Tax (GST) most of the States that were collecting the cess have removed the tax levied on cotton or waste cotton. However, Tamil Nadu contintues to collect it. Waste cotton does not go to the markets and is moved from the textile mills to industries that use the cotton for different purposes such as making mattress, carpets, and yarn. Under GST, cotton attracts 5 % duty. Hence, there is no need for another cess, he said. About 10,000 traders handle five lakh to eight lakh kg of waste cotton a month in the State.