Chenai: Indian beedis are exported to various countries, officials said during a roundtable and hence on the need to reduce the Goods and Services Tax (GST) rate on the product from 28%.
Industry officials said beedis are exported from India to Gulf countries, Singapore, the West Indies, the Netherlands, France and even the United States.
However, panelists from different walks of life called for a reduction in the GST rate.
According to them, the 28% tax rate has caused the shift of beedi production from the organized segment to the unorganized segment, affecting women workers and other marginalized sections, as they are deprived of benefits such as contribution to the provident fund, paid holidays, bonuses, gratuities, insurance and others.
Speaking at a panel discussion, Dr. Ashwani Mahajan, Country Officer, Swadeshi Jagran Manch said, “High GST on beedis is detrimental to both industry and labor. The production of beedis in India provides employment to nearly 90 lakh one crore people. The majority of workers are women who live in Maoist-dominated areas where there are no other employment opportunities.
He said it was essential to reduce the tax on beedi otherwise the industry would face the risk of cheap cigarette imports from China.
According to Arjun Khanna, co-secretary of the All India Beedi Industry Federation, the industry has played a significant role in generating income and employment in some of India’s most remote regions and high tax rates. will lead to unemployment and socio-economic ramifications.
Panelists said the high tax rate will lead to tax evasion and capture of the branded beedi market by cheap unorganized players.
“Beedi is an indigenous man-made product that has become the main source of income for over 20 lakh families in Bengal. Shutting down the beedi industry will have a severe impact on the livelihoods of these families as no other alternative has been offered to these families by the central government,” said Khalilur Rahaman, MP of TMC.