Footwear traders' strike against VAT strengthens

Enters third day, PVC- and rubber-sole traders join the indefinite strike.

As the footwear traders' strike against value-added tax (VAT) entered its third day in Agra, PVC- and rubber-sole traders of the town also joined the strike on Thursday making it the biggest strike witness by the industry in recent times.

Meanwhile, the issue of the Agra market being swamped by plastic moulded shoes manufactured in China is also gaining prominence in the strike. The traders are demanding an additional import cess on the cheaper Chinese shoes that have captured nearly 10 percent of the domestic footwear market.

A joint meeting of the Agra Shoe Factors Federation (ASFF) and Agra Rubber Sheet & Sole Traders Association (ARSSTA) was held in the Shoe Market on Thursday in which the footwear traders expressed concern on the government providing undue advantage to Chinese moulded plastic shoes by specifying a 4 percent VAT on moulded shoes while levying 12.5 percent VAT on the remaining footwear.

They demanded that footwear imported from China should have an additional import cess in order to provide a level-playing field to the domestic footwear manufacturers who could not compete with machine-produced shoes being dumped by China in the local market.

ASFF President Rajkumar Sama said the federation was not ready to give up on its aggressive stance on VAT unless the state government decided to either defer from imposing the VAT regime in the state or to place the handmade footwear of Agra in a tax-slab lower than the tax rates imposed on the imported and machine-made footwear.

Generally, there is a daily trading of almost Rs 1-1.5 crore in the wholesale footwear market of Agra but over the past three days trading has come to a standstill with all bulk footwear traders of the town going on indefinite strike against VAT.

Market sources claimed that the losses were not yet piling up as there was usually a slump in both demand and supply of footwear following the festive season with most of the footwear workers being away on leave.

But the situation could grow worse when the cottage unit workers returned to their factories next week and found no market for their daily production.