Ever heard of regressive taxation? Yes, it exists in the name of all that’s holy! And it shall be rightly levied on essential consumer goods. Lifting taxes on such necessities (and here we are talking about sanitary products) is promptly required as it satisfies the purpose of both social and economic justice. Which still is the need of many!
LUXURY VS NECESSITY
Ideally, taxes shall be imposed at a uniform rate on all consumer products, one rate of tax for all (as followed by various countries who have already implemented GST) regardless of the fact that these products are classified as a “luxury” or “necessity”.
This takes the following into consideration:
- Firstly, the larger the tax base, the lower the rate of taxation on individual products as the burden gets segregated.
- Secondly, it prevents the dilemma an unaware consumer would face while choosing different variants of taxed products.
Sanitary products to women are one such necessity and hence they should be made tax-free instead of classifying them as a “luxury” and taxing them at 12%.
People had high expectations that the government will come up with an optimized solution that will make sanitary products more affordable. But the implementation of GST made it an egregious new story for the women of India.
Ain’t we already struggling when it comes to feminine hygiene as only 12% of total women actually use sanitary products for getting through their monthly menstrual cycle. On the other hand, an estimated 70% of Indian women cannot even afford sanitary napkins.
It’s still a matter of profound worry as a large population of women in rural areas still rely on unhygienic alternatives, like a reusable piece of cloth, leaves and other unfathomable means to do away with their monthly cycle.
These factors have been recognized as a leading cause of various health hazards and infections in women, sometimes even becoming the cause of death. It is one of the real reasons why girls, particularly in rural areas, drop out of school.
What’s fueling the rage, even more, is that products like bangles, bindis, sindoor, kajal and even CONDOMS are classified in a zero percent tax bracket (Yes, you heard me right!). Apparently, the government seems to favour beauty standards and family planning over and above the health of women.
WELL, THE GOVERNMENT DO HAVE ANSWERS TO EVERYTHING… AND HERE’S THEIR JUSTIFICATION!
The finance ministry states that tax incidence on sanitary napkins have been kept similar in both pre-GST and post-GST scenarios as they used to attract excise duty of 6% and Value Added Tax (VAT) of 5%. Earlier it used to 13.69% after applying cess and now it has been reduced to 12%.
As per the implemented rates, a raw material used for the manufacture of sanitary napkins attracts 18% GST, this means that the manufacturers have to pay more GST than they actually collect from customers, which results in lesser input tax credit thereby increasing the cost of production. So the difference between the tax and input tax credit qualifies for a refund.
The reason why bangles, bindis, sindoor etc. are in the zero tax bracket in the first place is that their making involves low-skilled labourers who work in small or medium scaled enterprises and these products were untaxed even before GST came into the picture.
In addition to this, they have kept their morals aside and believe that reduction of the rate of GST will result in complete denial of Input Tax Credit on sanitary products for domestic manufacturers.
Ironic isn’t it… that contraceptives are considered a necessity even when they hold a double entendre in this conventional society. This is a sensitive issue and as biased as it may sound but the government has always been the one to accentuate the notion of family planning by way of advertisements and subsidies. Although fervid, I appreciate that at least they are taking a step forward. Should I still be holding a grudge against the slow and steady “tortoise” in this regard?
WHAT WOMEN WANT?
Frankly speaking, women are not at ease in their periods. A woman will spend at least 40,000 bucks on her menstrual cycle (between the ages 14-50, costing INR 80 per cycle). In fact, a significant number of them would choose to get rid of the whole monthly trauma because of the pain and discomfort it comes with.
As of 2016, Canada, Ireland, Slovakia, twelve US states, have already exempted consumers from paying taxes on sanitary products. If you were to argue that these are developed countries, let me tell you something enlightening… Kenya was the first to do it in 2013; it’s still developing and hence women in developing countries like India, need it more than anywhere else!