GST, demonetisation may impact Indian wedding market: ASSOCHAM
ANI | Updated: Oct 23, 2017 16:51 IST
New Delhi [India], Oct. 23 (ANI): The upcoming wedding season starting in November may be impacted by 10 to 15 percent owing to demonetisation and Goods and Services Tax (GST). Wedding services like marriage garden/marriage hall booking, tent booking, confectionery services, and photography will be particularly impacted, according to a study by industry chamber ASSOCHAM.
Demonetisation together with GST will affect the upcoming wedding season as people will have to shell out more on buying jewellery and apparels, at salons and beauty parlours, photography, even for hiring venues like hotels/marriage palaces, courier and other related services.
It is also being estimated that the average cost of many wedding services like shopping, tent booking, food services, etc., will be higher due to GST.
Tax on gold and diamond jewellery has increased from 1.6 percent to three percent. The booking for a five star hotel will cost 28 percent extra in the form of GST.
The GST rate on most of these services is from 18 to 28 percent. Before GST, most of the wedding service businesses like tent services, confectionery booking, etc., were using unregistered bills on which they didn't have to pay any tax, adds the paper.
Moreover, many people prefer to purchase wedding groceries and other items on due bills because of the unavailability of cash amount. But, under GST the traders might not be willing to sell commodities with due bills.
Currently, the Indian wedding industry is about 1 trillion rupees and is growing at 25 to 30 percent annually. The estimated cost of a wedding with no expenses spared could be between Rs. three lakh to Rs. eight crore, in India, according to the paper.
As per an estimate, on average, a person in India spends one-fifth of their wealth on wedding functions. Facing an increase in the cost of several items required in an Indian wedding, families are either revising their budget or looking to slash expenses to ensure they don't exceed the original budget by a big margin.
The ASSOCHAM study further goes on to reveal that, destination wedding or the wedding tourism sector in India which accounts for less than 10 percent share in the overall industry is not likely to face much adverse impact of GST and demonetisation as it is already a very costly affair. It mainly lures foreigners, NRIs, rich and famous people for exotic weddings at beaches, royal palaces, and adventurous places.
In India, Goa is the most popular destination for Indian beach weddings and the palaces and forts of Rajasthan are also sought after, while Bali and Dubai are desirable spots for weddings overseas, adds the ASSOCHAM findings.
Online portals like Shadi.com, Bharat matrimonials and others rack up revenues of Rs. 300 to 350 crore from match-making annually and believe the business can only get bigger. There are wedding planners in the country who are ready to make all arrangements required for an Indian wedding, from beginning to end, for a whopping increase. (ANI)