Thoothukudi: The safety match manufacturers today began an indefinite strike demanding the Centre to exempt Goods and Service Tax (GST) on the industry.
This comes on the heels of a similar protest commenced by the fireworks manufacturing units in Tamil Nadu yesterday.
Talking to newsmen here, J. Devadoss, Secretary of South India Match Manufacturers Association, said while the levy of 5 per cent GST on non-existent handmade safety match sector was unnecessary, the levy of 18 per cent GST on production of safety matches by semi-mechanised and fully mechanized units would adversely affect the match manufacturers and thousands of workers depending on the industry.
“The country’s foreign exchange would also be affected as possibility of exports would be hit,” he said.
Previously, the manufacturers used to pay six per cent excise duty on total goods manufactured through semi-mechanised units, 12 per cent duty for matches manufactured through fully mechanized units and five per cent sales tax.
“There was much anticipation that the different categories in production would be brought on the same platform under a uniform system of taxation. But, the levy of 18 per cent GST on production of safety matches by semi-mechanised and fully mechanized units came as a rude shock to the industry,” he said.
With the advent of lighters and automatic strikers in gas stoves, match consumption was considerably reduced after 1996 and the safety match manufacturing units in Tamil Nadu were fighting for survival due to labour shortage and rising raw material costs.
The match industry was already removed from the small scale sector and included in the large scale sector causing huge difficulty to the stake holders.
He said around 100 semi mechanized units, its allied sector comprising 700 units and 30 fully mechanized units functioning in parts of Thoothukudi district closed their production activities.
M. Paramasivam, President of National Small Match Manufacturers Association, said the manufacturers have planned to take out a rally in Kovilpatti, here on July 3, demonstration in front of the Divisional Office of Central Excise on July 4 and rail roko agitation on July 5 demanding the Centre to give full exemption or at least slash the GST for the match industry.