GST
has been introduced in the country from July 1st
2017 and has more-or-less become effective all over the country. What
are the stated aims and objectives of GST? This
has
been
summarised as follows:
“GST
is one indirect tax for the whole nation, which will make India one
unified common market. GST
is a single tax on the supply of goods and services, right from the
manufacturer to the consumer. Credits of input taxes paid at each
stage will be available in the subsequent stage of value addition,
which makes GST essentially a tax only on value addition at each
stage. The final consumer will thus bear only the GST charged by the
last dealer in the supply chain, with set-off benefits at all the
previous stage.”
As
can be seen, the main aim is to make India one
unified market
with one
set of tax rules
governing all transactions within this unified market. All producers
and consumers are to be included in this unified market (which
includes the entire Lokavidya
Samaj consituting
about 85 crore people; who are both producers and consumers).
A majority of goods produced and services provided by Lokavdiya
Samaj,
pertain to daily life and livelihood necessities. There are hardly
any ‘luxury’ goods or services provided by Lokavidya
Samaj.
Most of the goods and services are locally produced and consumed. So
what does a national or all-India market mean to Lokavidya
Samaj
? Will GST have any effect on the activities/transactions of and
within Lokavidya
Samaj?
Will Lokavidya
Samaj
or its livelihoods gain any benefit from GST?
The
first response of Lokavidya Samaj to GST
In
response to the imposition of GST on handmade products, the Graama
Seva Sangha, Bengaluru announced a nationwide movement to Free
Hand Made Products from GST by
launching a Tax
Denial Satyagraha
on 27-Aug-2017 at Bangalore. The Satyagraha was inaugurated by
Theater Director and Social Activist Prasanna Heggodu, well
known for his efforts to build co-operatives such as Charaka
and Desi
that promote a sustainable livelihood for handloom workers. Following
the clarion call given by the Graama Seva Sangha, “Don’t
collect and don’t pay tax,”
the
rally witnessed a sale of handmade footwear, fabric, mats and pots
without tax.
A
second Satyagraha was observed in Hyderabad on September 9,
spearheaded by the All-India
Federation of Handloom Organizations
and Dastkar
Andhra,
demanding the withdrawal of tax by the GST Council
which had its meeting in the Telangana capital on the day.
These organisations have appealed to likeminded organizations
and movements across the country to come together to fight for the
abolition
of
tax on handmade goods as well as for the creation
of
policy initiatives that recognize handmade products as the foundation
of true Swadeshi
manufacture in the country.
The
Satyagraha will be observed in other parts of the country too,
including Chennai, Kolkata and Jaipur from September 11 to 24. A
padayatra will begin from Junjappana Gudde in Sira taluk in Tumkur
district of Karnataka on September 24 and the march will reach
Kasturba Gandhi Ashram at Arasikere on October 2, after covering 120
km by foot. A hunger Satyagraha will begin at Arasikere on October 2,
on the occasion of Gandhi Jayanti.
The
argument for Satyagraha
For
the first time since independence, a tax has been imposed on all
handmade products in India( which are sought to be sold in this
all-India market i.e outside the local market area) As a result,
Khadi, handloom, handicrafts and the like are taxed under the GST
regime. Under GST, luxury products have become cheaper, while
handmade products have become expensive. Cars and cigarettes cost
less, while a Khadi saree, a handloom kurta, a mat, pot and plough
will cost more. Across India, producers of handmade goods who are
already in distress will face even more hardship as a consequence of
the imposition of the tax.
“With
this tax the rural enterprise, already in distress, is going to be
hit further. We had fought the British against an inhuman tax on salt
nearly a century ago through a Tax Denial Satyagraha. It has become
necessary to wage another Satyagraha, and that too against our own
government, because GST has dealt a death blow to rural enterprise. “
The
aims and objectives of the Satyagraha
The
organisers believe that this Satyagraha will restore the moral
leadership of India as well. For, “morality is made by toiling
hands. Sant
Sabhyata
the saintly civilization of India is handmade. Sant Ravidas, Sant
Kabir, Sant Kanakadasa and Vachanakara Sants were all handcrafting
people. Handmade production, equitable society and spirituality
of simple living formed
the three tenets of that
Sabhyata.
Today the Sabhyata
is in danger. This campaign, for making handmade products tax free is
a major step towards the rejuvenation of that Sabhyata.”
“The
British
enslaved India not so much through the gun as through capitalist
industry; not so much through politics as through commerce. They came
as merchants. Remained as merchants. Plundered natural resources,
brought machine made products, and managed to sell the millmade.
They did so through tax manipulations. Handmade was taxed heavily
while the British machine was given concessions. The same policy is
being used by our governments now. GST, created jointly by all state
governments and the central government is wrong in many other ways.
The machine made that is spreading death across the globe and
destroying nature environment and society is made cheaper while the
rural product, which is nearly carbon neutral, is made dearer by this
regime.”
“This
struggle involves radical changes to the organization, ethos and
economics of the society and cannot be undertaken without support
from all sections of the society across India.”
The
all-India market and GST
The
idea of GST is to establish a single all-India market with a single
set of ‘market taxes’. So every producer/service-provider, who
wishes to participate in this single market, must register and then,
hopefully, derive the ‘benefits’ of this single tax regime; while
the consumer ( who does not need to register) can get the ‘benefit’
of this single tax regime at any place or time within this single
market area.
Industrial
(large scale) producers and service-providers will obviously benefit
from this ‘no-boundaries’ market system; where buying and selling
has been freed from the ‘limitations and vagaries of localities and
geographies’. With the widespread decrease in margins/surpluses,
small producers/service-providers have
been
forced to participate in this market system, most
often on very adverse terms of trade.
In
order to avail of the ‘benefits’ of this
GST regime ,
they
find that,
rather than proving to be a boon it
is
actually proving to be a bane and a curse on their lives and
livelihoods; thus the Satyagraha!
The demand for no-tax/zero-tax on handmade produce and services
(which
permits for
inclusion in the all-India market system),
arises from this situation. The legitimacy of this demand cannot be
questioned on any economic or moral ground!
Challenging
the market ‘dharma’
Market
activity involves buying and selling, and the aim is to make (or
increase) profits for the producer/service-provider. This is the sole
aim of (modern) market activity the world over, that is, this is the
globalised ‘dharma’
of the modern market system. Producers and service-providers of
Lokavidya
Samaj
have for long been localised and served the needs and necessities of
local producers and consumers through a sustained local-market
system. This system seemed to have survived (through the ages)
through a now-forgotten ‘dharma’
; of meeting the needs and necessities of the local producers and
service-providers through a relatively fair system of exchange rather
than one based on ‘cut-throat’ , competitive, profit-oriented
buying and selling activity; devoid of any humanity or
environmental-friendliness.
How
can the State (or local body) seek revenue, through taxation, on
hand-made goods and services? The only
capital involved, in such productive or service activity, is human
labour and Lokavidya.
What tax can one legitimately
levy
on produce based on such capital? What Economics and/or morality
supports such taxation?
The
Sant
Sabhyata, that
the current Satyagraha
avers to, probably paraphrases this now-forgotten ‘dharma’.
Can the Satyagraha
rekindle this ‘dharma’
within the rank and file of Lokavidya
Samaj
hand-makers? The sustenance of the opposition to the tax, on
hand-made goods and services in the current GST regime, will largely
depend on this internal strength that the Satyagraha
is able to infuse in the rank and file of Lokavidya
Samaj .
Krishnarajulu,
September 2017
