Fashion
GST rate rationalisation to profit Indian states in FY26: SBI Research
First, GST is shared equally between the central government and the states, with each receiving half of the collections. Second, under the mechanism of tax devolution, 41 per cent of the central government’s share flows back to the states, SBI Research said in a report on GST.
The proposed goods and services tax (GST) rate rationalisation is likely to result in stronger revenue collections validated by historical trends due to the unique revenue-sharing architecture of the tax, according to SBI Research.
FY26 projections indicate that states are expected to receive at least ₹10 trillion in state GST plus ₹4.1 trillion through devolution, thereby making them net gainers.
Taken together, this means that out of every ₹100 of GST collected, states ultimately accrue nearly ₹70.5.
SBI Research’s FY26 projections indicate that states are expected to receive at least ₹10 trillion in state GST plus ₹4.1 trillion through devolution, thereby making them net gainers.
The gains accrue even when the researchers did not take the additional consumption boost due to rate rationalisation.
“Evidence from earlier rounds of GST rate changes, such as those in July 2018 and October 2019, suggests that rationalization does not necessarily weaken revenue collections. Instead, the evidence points to a temporary adjustment phase followed by stronger inflows,” the SBI Research report noted.
“While an immediate reduction in rates can cause a short-term dip of around 3-4 per cent month on month (roughly ₹5,000 crore, or an annualized ₹60,000 crore), revenues typically rebound with sustained growth of 5-6 per cent per month,” it added.
Fibre2Fashion News Desk (DS)
The concerns include the impact of goods and services (GST) rationalisation on the fiscal health of the central government and the states.
ICRA foresees India’s 10-year government security (G-sec) yield to trade between 6.40-6.70 per cent in the immediate term owing to several developments that have raised concerns around an overshooting in G-sec supply.
The weak growth in tax collections in the first four months of FY26 implies that the required expansion in the remaining eight months to meet budget estimates is quite steep.
However, yields could cool if the government sticks to its borrowing calendar for the second half (H2) of fiscal 2025-26 (FY26) that will be released in September end, ICRA said in a research note.
The Indian government’s fiscal deficit surged to ₹4.7 trillion in the first four months of FY26 from ₹2.8 trillion in the corresponding period of FY25 owing to multi-fold rise in the revenue deficit and the frontloading of capital expenditure (capex).
The muted 0.8 per cent growth in gross tax revenues (GTR) combined with the healthy 17-per cent increase in central tax devolution (CTD) compressed the net tax revenues in the four months, it noted.
The weak growth in tax collections implies that the required expansion in the remaining eight months of this fiscal to meet FY26 budget estimates is quite steep, especially for income tax, although healthy progress in non-tax and miscellaneous capital receipts provides some comfort, ICRA added.
Fibre2Fashion News Desk (DS)
By
AFP
Published
September 3, 2025
Asian discount clothing giant Shein has been fined a massive 150 million euros in France for failing to comply with legislation on cookies, the French privacy watchdog Cnil announced on Wednesday.
The Cnil, which has also imposed a record fine of 325 million euros on Google for similar grievances, denounces the fact that these computer trackers had been deposited on the devices of Internet users who had visited the Shein site without their consent, or without respecting their choice or informing them correctly.
These are the two biggest penalties ever imposed by the Cnil, with the exception of a 150 million euro fine imposed on Google in 2022, also on the subject of cookies.
The French data protection watchdog justified the exceptional nature of the fine imposed on Shein by the fact that the legislation on which this decision is based is already in force, in particular the French Data Protection Act (Loi Informatique et Libertés), which the company could not ignore.
“Since 2020,” Cnil’s restricted committee “has on numerous occasions sanctioned organizations for similar breaches, making its decisions public,” stressed the institution in a press release.
This is a colossal sanction, given the very high number of users potentially affected – an average of 12 million French people every month – argued the Commission Nationale de l’Informatique et des Libertés (Cnil).
Shein complied “during the course of the procedure,” the Cnil pointed out.
The company “firmly contests” this decision “and will lodge an appeal with the Council of State and the Court of Justice of the European Union,” it told AFP.
“We consider the fine to be totally disproportionate, given the nature of the alleged grievances, our current compliance, and the proactive corrective measures we have put in place,” said Shein.
“The severity of the penalty appears to be motivated by political considerations rather than by a fair and balanced application of the regulations,” the company judges. Recalling that it has “fully cooperated with the Cnil” since August 2023, Shein says it regrets that “no warning was ever issued” prior to the “formal notice.”
The brand, which stands out for its extremely low prices, profusion of SKUs and aggressive marketing, has been booming in France and Europe in recent years.
However, it has attracted the wrath of human rights and environmental associations, trade players and the authorities. Accused in turn of environmental pollution, deceptive business practices, unfair competition, and undignified labor, Shein symbolizes, according to its detractors, all the ills of “ultra fast fashion.”
The company with sales of $23 billion (by 2022) is the target of a proposed French law aimed at regulating ephemeral fashion, notably through an advertising ban, financial penalties, and an obligation to make consumers aware of the environmental impact of their clothing.
At the beginning of July, the platform was fined 40 million euros for misleading commercial practices by France’s Repression des Fraudes, for, among other things, marking up certain prices before applying a discount.
Paris, Sept 3, 2025 (AFP)
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By
Reuters
Published
September 3, 2025
American Eagle Outfitters forecast third-quarter comparable sales above expectations on Wednesday, betting on the demand driven by promotions and new products, sending the shares of the apparel retailer up 25% after the bell.
Apparel firms such as American Eagle and Abercrombie & Fitch have defied a slowdown in the retail sector through promotions and a focus on more affluent consumers.
American Eagle has been trying to boost demand through its marketing initiatives, including the controversial “Great Jeans” denim campaign with actress Sydney Sweeney, following partnerships with tennis player Coco Gauff and actress Jenna Ortega.
The apparel maker has also partnered with National Football League player Travis Kelce’s clothing brand Tru Kolors, creating buzz among shoppers as the news followed Kelce’s engagement to pop star Taylor Swift.
The company expects quarterly comparable sales to rise in the low single digits, compared with analysts’ expectation of a 0.3% decline, according to data compiled by LSEG.
It also expects annual comparable sales to be flat compared to a year ago, while analysts estimated a decline of 1.1%.
© Thomson Reuters 2025 All rights reserved.
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