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Firecracker Sales drop Due to High Tax Rate Of GST

Every year we spend a lot of money for Diwali shopping. That too in Chennai we can find every shopping area to be busy filled with a huge crowd of people. More than buying clothes, accessories we can see people buying lots and lots of Firecrackers.

We can find a variety of crackers with weird, crazy names that excite us to buy more and more. The way of how the store is decorated the crackers are kept, fascinates us the most. Buying crackers and going home is one of the best feelings one can have. In fact, more than the new dress, the pooja, Diwali is all about lighting up the crackers and having fun with friends and family.

But there are some changes in this year’s Diwali Celebrations. Usually, the firecracker companies and its workers earn high profits during the season of Diwali. They share the profit by splitting the total earning and giving it to the people who have co-worked for it. This is the standard procedure. But this year, there is a high drop in the sales of firecrackers.

Due to the introduction of GST, The firecrackers industry faces a High tax rate of 28% whereas 12 % of the tax rate is for corrugated boxes. The Corrugated box making industry is responsible for providing boxes for the sales of crackers. It’s like they go hand in hand for making sales. But due to the high tax rise, many people have lost their jobs in the firecracker factories.

K.Rama Moorthy, Sivakasi Branch, President of South India Corrugated Box Manufacturers Association Had stated that the job orders have fallen down heavily even though it is the festive season.

In Sivakasi, there aren’t many orders this year, as the orders are down by 40 percent. Manufacturers of nearly 150 corrugated box companies, employing around 5, ooo people are affected down by this 40 percent drop.

Other districts are also facing a similar condition but the people in Sivakasi are hoping to survive with orders this Diwali. Usually, the crackers were sold with advance payment but now it is sold for credit as the manufacturers are facing a financial crisis.


The consumers thought that the GST rate will drop but since there weren’t any this has led to a major drop in the firecrackers industry.The only solution for this is to reduce the abnormal tax rates on products. And reducing the GST rate on firecrackers.


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Firecracker Sales drop Due to High Tax Rate Of GST

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