Delhi markets see fewer footfall post-GST cut:Traders complain higher taxes on clothes above ₹2,500 turn festive shoppers back

India’s ‘GST savings festival’ officially began today following the 23rd GST Council meeting, which introduced major revisions in the GST structure. Despite the government’s push to celebrate, markets in Delhi, particularly in Chandni Chowk, are witnessing minimal footfall. Major GST reforms introduced PM Modi-led government’s recent reforms aimed to simplify the tax structure, moving towards a two-slab system: 5% and 18%. While GST rates on over 233 items have been reduced, essential clothing and mid-range products priced above Rs 2,500 have seen an increase to 18%, up from the earlier 12%. Traders express concerns Traders expressed frustration over the changes. Piyush Gupta, a lehenga trader in Katra Shahenshahi, said, “Customers are not coming because the GST increase has made clothing more expensive. Earlier, items under Rs 1,000 were taxed at 5% and above Rs 1,000 at 12%. Now, items above Rs 2,500 attract 18%, which is unaffordable for many.” Empty markets despite festive season Business activity in Chandni Chowk, a traditional wholesale hub, reflects this concern. Shops remain largely empty, a stark contrast to last Navratri when the market was overcrowded. Traders emphasize that despite the reduction in GST on some essential items, the benefits have not translated into increased sales, especially for slightly higher-priced garments and ready-made clothing. GST impact on pricing and customer behavior “The government has reduced GST on basic apparel, which is welcome,” said Gupta. “However, items slightly above ₹2,500 have become costlier. Customers prefer to avoid paying the higher tax, sometimes even asking for items without bills. This has disrupted the market entirely.” Government initiatives for consumer protection Officials highlight that while the reforms aim to provide relief and simplify compliance, small traders continue to struggle. Polyester-based clothing, which is widely used for shirts and lehengas, now faces higher taxation, further affecting affordability for consumers. A dedicated portal on the National Consumer Helpline and a toll-free number (1915) have been established for reporting cases where GST rate reductions are not passed on to customers. Long-term benefits and market challenges While the GST 2.0 reforms are expected to benefit sectors like renewable energy, FMCG, and agriculture, the immediate impact on retail clothing markets highlights the need for balancing tax policy with ground realities. Traders continue to hope for adjustments that provide relief to both businesses and end consumers during the festive season.