Big GST Cut: Zero Percent GST On Sanitary Napkins in India

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August 13, 2018

GST on Sanitary Napkins

Sanitary Napkins Exempt from GST:

On 21st July, in the 28th GST Council meeting regime has made a decision to change the GST rate on sanitary napkins from 12 per cent to ZERO per cent.

The reason is that the reduced rate is applicable on the final product, while the manufacturers still have to pay GST on inputs like cotton (5%), plastic packaging sheet (18%), aseptic packaging paper (12%) and advertising (18%), with no credit availability. This has resulted in almost no price change of sanitary napkins even after a reduction in tax rate.

Also, no GST on imports of sanitary napkins along with low production cost further increases the problems of local vendors. The step to remove GST, along with input tax credit (ITC), on sanitary pads is causing troubles for the industry as well as for the buyers.

Supreme Court Stayed Sanitary Napkins Related Cases In Delhi, Bombay HCs

The Supreme Court Of India has stayed all the cases of the Delhi and Bombay HCs, related to imposing GST on sanitary napkins. The apex court clearly stated that all the cases regarding sanitary napkins will be henceforth heard in the supreme court only. The independent petitioners have also been issued the notice regarding this issue.

Protest To Keep Sanitary Napkins out Of GST Ambit

It must be noted that the imposition of GST on the sanitary napkins has seen a widespread protest in the several parts of the country. People involved in protest are asking to keep sanitary napkins out of the GST ambit. They are of opinion that the sanitary pads are very basic and common thing for all the women and it’s a necessary element for the sanitation and hygiene. In the first week of January, a group of students from the Gwalior had sent messages to the Prime Minister Narendra Modi, written on sanitary pads, to abolish the 12 percent GST on it.

GST Rate On Sanitary Napkins

Under the GST regime, the sanitary napkins have been put in the bracket of the 12 percent tax. As per the finance ministry, the tax levied on it is less than the previous taxation structure. In the pre-GST period, sanitary napkins carried 13.68 percent of the tax. It had to carry the excise duty of 6% and value-added tax (VAT) 5% and some cess to make the tax levied at 13.68%.

GST On Raw Materials Of Sanitary Pads

The raw material used in the making of sanitary napkins carry 12 percent and 18 percent GST. It means that the manufacturing tax is more than they will collect from the buyers. This has made the manufacturers eligible for the GST refund.

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