Fireworks industry that has been on an indefinite strike against higher Goods and Services Tax (GST) of 28% since June 30, on Wednesday announced withdrawal of its agitation following the assurances given by Tamil Nadu Government of representing its case before the GST Council in August.
After a meeting of representatives of three major associations of the cracker industry and other related industries here on Wednesday, president of Tamil Nadu Fireworks and Amorces Manufacturers’ Association, A. Asaithambi, announced the decision of withdrawing the strike.
Office-bearers of TANFAMA, The Indian Fireworks Manufacturers’ Association and Tamilan Fireworks Manufacturers’ Association met the State Finance Minister, D. Jayakumar, Secretary to Government (Commercial Taxes), C. Chandramouli, and explained about how the higher GST would affect the fireworks industry.
“The Minister said that Tamil Nadu Government would take up the issue with the GST council when it meets on the first Saturday of August. He has also asked us to impress upon the Finance Ministers of other States too on the higher tax on our industry and support fireworks industry’s contention in the GST council,” TANFAMA secretary, Mariappan said. The Secretary has also said that the State Government was fully aware of the issue.
“The fact remains that no authority can make any changes in the rate of GST till the GST council meets on the first Saturday of August. Hence, we have decided to give up the strike and make our representation before the council,” Mr. Mariappan said.
A leading fireworks manufacturer, G. Abiruben, said that fireworks industry being predominantly a handmade industry and involving more than 80 per cent women workforce, cannot absorb higher GST of 28%.
“Our input cost on raw materials is just 40% and 70% manufacturing cost is on wages of labourers. Hence, the industry cannot expect higher input credit too,” he added.
Mr. Mariappan said that the peak production of crackers for the ensuing Deepavali season begins in July and goes for the next three months.
“As of now, the industry has produced not even 25% of the production. We cannot lose 40 working days on strike rendering at least five lakh employees jobless as the GST council would be meeting only in August. Hence, we have decided to withdraw the strike with the hope of something good happens to the industry,” he added.
