Usha Cooperative Bank in India Alarmed at Introduction of GST on Sanitary Napkins in India

Asia Pacific Regional Correspondent

Spokespeople from the Usha Multipurpose Cooperative Society, a cooperative bank run by sex workers in India, have told media how the introduction of an 18 percent GST (Goods and Services Tax) on sanitary napkins in India will negatively impact their community.

They are relieved that condoms will be exempt from the tax, but are alarmed by the dramatic increase for important menstrual products. The cooperative bank is concerned they will not be able to subsidize the cost of the sanitary napkins they supply to its members.

The Usha Cooperative bank is the largest of its kind in India. Besides catering to the financial needs of communities locked out and discriminated against by more traditional financial institutions, they also provide menstrual products and condoms to thousands of sex workers at a subsidised rate. The majority of the bank’s 30,000 members are from Sonagachi and other red-light areas of Bengal. 

The Usha Cooperative Bank’s finance manager Santanu Chatterjee told reporters they are the single largest supplier of sanitary items to sex workers, averaging 65,000 per month. “In some months, it crosses 80,000,” said Chatterjee.

Bharati Dey, a former secretary of Durbar, added “it’s the poorest sex workers, who use subsidised sanitary napkins that will be hit the hardest.’”

The bank has joined in calls from feminists to health experts who have backed calls for menstrual products to not be classified as a luxury good and therefore taxed at such a high rate. As one article argued, “it ought to be obvious that pads, an aid to menstrual hygiene, cannot fall within ‘luxury goods’, and should be exempt from taxes, in principle and practicality.”

Currently around 70 percent of people who menstruate in India cannot afford sanitary napkins. The lack of sanitary products and use of unhygienic alternatives increases the risk of reproductive tract infections (RTIs) by 70 percent. As one writer explains, while the disposal of such products is definitely an environmental problem, avoiding the use of sanitary products is also not the solution. There are many individuals and enterprises working on alternative eco-friendly products.”

The Hindustani Times reports that in 2000, the rate of usage of sanitary napkins among sex workers was 20 percent. However, over the years this has increased and now more than 85 percent of sex workers use sanitary napkins.

This increased uptake in sanitary napkins occurred because of a sustained awareness campaign combined with the sale of sanitary napkins at subsidised rates through the Usha Cooperative Bank. However, the introduction of this Goods and Service Tax (GST) would severely impact their ability to afford sanitary napkins.

It is not just the price of the GST alone. Santanu Chatterjee says companies which used to sell these products with special discounts, have refused to do so since the GST introduction.

Soma, a 34-year-old sex worker and a mother of two, described sanitary napkins as a “necessity” but explained, “if the prices go up, we will be left to go in for alternative means to maintain hygiene.”

“Women shouldn't refrain from using pads now just because of the added financial burden," said Dr Hema Divakar, former president of The Federation of Obstetric and Gynaecological Societies of India, Karnataka chapter.

The tax has comes at a time when red-light areas are already trying to recover from demonetisation. Two higher denomination notes (Rs 500 and Rs 1,000) became non-legal tender over night in November last year, and many sex workers could not exchange their notes with traditional banks and clients still tried to pay using these notes, which were not valid anymore.

The good news is that “zero per cent GST on condoms will bring down its prices and will encourage the usage of it” according to Dr. Smarajit Jana, who was quoted in the Indian Express.

One sex worker quoted in the financial times summed up the situation: “condoms are our lifeline, and it is good that there is no GST on them. But now, they are saying that napkin prices will go up. I don’t understand GST… but already, clients are less… some girls may not be keen on using napkins, and make do with cloth to save money.”