Govt May Rationalise Its GST on Sanitary Pads, But Is It Logical?

A lot of social media outrage was witnessed in the last few days over the 12% tax slab.

(Photo Courtesy: Liju Joseph/The Quint)

We are going through interesting times, most of which revolve around some kind of revolution. Sometimes we stop and notice and at other times we just give it a pass. Mostly, we give it a pass if it is not something immediate, intimate and interfering.

But how about something as regular or as painstakingly punctual as menstruation? How about the 12% tax imposition on sanitary pads under the revolutionary GST era?

We have witnessed a lot of social media outrage in the last few days over the 12% tax slab. A press release from PIB justifies this rate by showcasing the 12% to 18% tax fixed on raw materials used for manufacturing sanitary pads.

Hence, from this perspective, the post-GST rate is all but justified in every possible sense, especially for the manufacturers.

Also Read: Taking the Sanitary Napkin to Public Spaces

Why the Government’s Logic Does Not Add Up

Now here's the deal. These raw materials, namely, polymer, super absorbent polymer, glue, polyethylene, LLDPE, release paper, thermo bonded non-woven and wood pulp, make up only 20% of the production cost of commercial sanitary pads.

Cotton is the key material, comprising 80% of the final product, and post-GST, the tax on it remains 5%.

Hence, the apprehension expressed by the Government over higher accumulation of input tax credit and accentuation of tax inversion if the rate is anything but lower than 12%, doesn’t seem to add up.

Furthermore, if the sustainable menstrual options are encouraged, like the cloth pads and menstrual cups, the 12% to 18% taxed raw materials can be completely avoided. This will lead to a considerable reduction in cost of production and hence affordability to the end user.

Also Read: Dear Arun Jaitley Ji, Sanitary Pads Should Be Tax-free, Period

A movement by the name ‘Green the red’ has been started by women’s groups in Karnataka, which campaigns for separate taxes for sustainable and common menstrual products.

According to them, the organic ones should have lower taxes than the commercial ones. Sushmita Dev, Congress MP in the Lok Sabha, started her online petition on Women's Day this year, appealing to the Union Finance Minister to make the 'eco-friendly' pads completely tax-free and the non-sustainable ones at 5%.

The Urban-Rural Scenario

The National Family Health Survey report of 2015-16 puts the number of girls and women using hygienic menstruation products – sanitary pads, tampons etc – at 57.6%. This includes 77.5% of the urban female population and 48.5% of the rural population.

Women in rural pockets often cannot afford hygienic menstrual products leading to not only physical sickness, but also school dropouts and a massive misconception shrouding the entire menstruation process.

Under the new era of GST, the commercial pads will become even more unaffordable in rural areas. However, this scenario actually presents a unique environment to make a switch from chemical-laden sanitary pads to organic ones.

70 percent

of women of menstruating age cannot avail of proper hygienic products – an indicator of the dire need for an alternate solution.

Also Read: The Govt Thinks I Need Pizza & Sindoor More Than Sanitary Pads

The Concept of Reusable Pads

For starters, let’s get introduced to the ‘Cloth Pad Revolution’, a term coined by Eco Femme – a social enterprise in Auroville, Tamil Nadu, dedicated to spreading awareness about menstrual hygiene.

When Kathy Walking, Co-Founder and not-for-profit team leader of Eco Femme, came to Auroville, she had no option but to find places to bury the used pads like other local women. That is when she came up with the concept of reusable cloth pads. Today, 20% of its products are sold to rural women at subsidised rates and the rest 80% goes for commercial sales.

The organisation makes washable cloth pads in the Auroville Village Group Campus and has retailers in 23 countries around the world.

In a world where consumerism is playing a monstrous role in destroying our ecological habitat, this organisation is undoubtedly building a better tomorrow through organically customised alternatives.

Although menstruating women have used cloths for centuries, what makes the cloth pads stand out is their ready-to-use design. Organic cotton fabric is the prime raw material used for manufacturing these cloth pads.

Hence, the tax rate concern can be taken care of effectively. But the prime advantage of such pads is that they are skin-friendly and last from 3 to 5 years. So, in the long run, they are highly cost effective and provide a source of financial empowerment to all those women in Indian villages who are engaged in manufacturing such pads.

If social enterprises like Eco-femme, Goonj NJPC, Anandi pads and some other similar ones are encouraged and funded, the post-GST era can actually be a boon to both the seller and the buyer, with the cotton tax being the same.

Also Read: Happy Periods: Tax-Free Sanitary Pads are a Good First Step

(The writer is a Bengaluru-based blogger and is a former reporter, Times Of India. This is an opinion piece and the views expressed above are the author’s own. The Quint neither endorses nor is responsible for the same.)

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