Vol. 16 No. 1
Dummy variable regression to compare and post GST condition of handloom weavers
Author(s): J.S. BASAK, M. SAHA, M. ROY, P. MALLICK, T. BISWAS AND P.K. SAHU
Abstract: GST known as Goods and Services Tax, is a type of indirect tax. In Indian economy it is a paradigm shift. Introducing in 2017 and including huge number of items and eliminate 7 indirect central and 10 indirect state tax on a single item,it increased the tax base. In it amount of tax also distributed with defined percentages within the central and state governments. As there was no tax on handloom industry, so, imposed tax on it becomes a burning topic nowadays. To examine GST effect on handloom weavers in West Bengal,an initial attempt has taken in this article as a case study using stepwise regression model with single dummy variable (Di). From traditional weavers’ village Nasratpur situated at 23ºN and 88ºE, primary information from 135 handloom weavers from different groups were collected during March-April, 2018. After GST selling prices of handloom sarees is decreasing whereas raw material cost per saree is increasing. To maintain profit margin, handloom owners are cutting down the labour wages. Moreover, the decreasing trend in sales of sarees compared to pre GST condition. Regression analysis of income from handloom on 8 independent variables reveals that the two regression lines are different in pre and post GST condition which is proved by significant of coefficient of intercept Di and DiXi4 variable. The study recommended that efforts needed to diminish raw materials cost for handloom with improving channels of marketing for selling handloom goods.
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