Business Other News 19 Oct 2017 Cyclonic weather hit ...

Cyclonic weather hits sale of Diwali crackers

DECCAN CHRONICLE.
Published Oct 19, 2017, 6:30 am IST
Updated Oct 19, 2017, 6:30 am IST
The government has fixed goods and services tax (GST) on the fireworks industry at 28 per cent. 
With this, the prices of branded firecrackers have skyrocketed and resulted in a lower turnover.
 With this, the prices of branded firecrackers have skyrocketed and resulted in a lower turnover.

Visakhapatnam: Branded fireworks retailers have faced severe losses this Diwali season for two primary reasons. One is the additional tax burden and second is the cyclonic weather condition in the region. 

The government has fixed goods and services tax (GST) on the fireworks industry at 28 per cent, which is almost double the earlier value added tax (VAT) of 14.5 percent. With this, the prices of branded firecrackers have skyrocketed and resulted in a lower turnover. “The sale of firecrackers has come down drastically when compared to the last year figures. We have seen 50 percent drop in our business, and we have not earned one-third of the revenues that we did last year. There was a sale of around Rs 50,000 per day last year, while now it is less than Rs 25,000 a day", said Avinash Kumar of Sri Venkateshwara Crackers, a retail showroom at Beach Road.

 

The retailers attributed the poor sales not only to the GST but also to the current weather conditions. Nagesh Babu, another vendor from the city, said: “The prices of firecrackers increased because of the GST but the number of customers have decreased due to the climatic condition in the city.”

“Expecting good business, we had ordered huge stock from the wholesalers. But our investment is stuck now as the wholesalers will not take the unsold stock back and give back the money. Initially, we had planned to offer 70 per cent concession on Sivakasi's Ayyan and Ajanta firecrackers. However, we gave 85 percent discount on these brands when the showers started,” he added.

 

Overall the fireworks industry is suffering from the GST burden, with profits of retailers shrinking considerably for multiple reasons. Apart from the taxes, bad climate and environmentalists' propaganda against firecrackers have also affected their business.

...




ADVERTISEMENT
ADVERTISEMENT
ADVERTISEMENT
ADVERTISEMENT
ADVERTISEMENT
-->