There are many reasons why Hindus celebrate Diwali Festival of Lights, or “row of lights,” but the two most common reasons are the victory of Ramacandra (Rama) against Ravana, the demon king; and honoring Lakshmi, the wealth goddess, for a plentiful financial year ahead. The celebration of a plentiful year begins on the last day of harvest season before the winter. Today, business owners use this time to start their financial year over. Diwali occurs on October 19 in 2017.
While Diwali may have marked a great start for businesses in previous years, a change in the Goods and Services Tax (GST) could mean a shift in celebrations. Last year, Prime Minister Narendra Modi pushed for a new tax reform similar to the UK’s single market according to Forbes. Like any economy, there may be issues that arise, such as creating a threat to smaller businesses and raise taxes tremendously in some areas of India rather than others. Some experts say the new GST system will hurt some industries and become beneficial for others. However, while some businesses are looking forward to the holiday season, some might be hesitant to cut prices for their buyers.
In 2015, research showed that Diwali Festival of Lights was creating a new norm for consumers. Lower prices meant spending more and as these individuals spent more, the economy created more jobs. What researchers found was that consumers didn’t stop spending once the holidays were over. In fact, overall, people maintained their spending habits, even though it dropped five percent once the holidays were over. However, that might change for this year’s festival.
According to Financial Express, when GST came into play on July 1, stores cleared their shelves so they wouldn’t pay taxes on existing products within their stores. Now, owners are replacing sold inventory on their shelves, yet not fast enough to keep consumers happy. Manufacturers had an increase on importing costs, meaning less risk for higher discounts. While some companies are still certain they will lower typical discounts, others are waiting to see where online contenders set their prices.
Diwali Festival include gift exchanges and partaking in various activities that involve firecrackers, lights, food, and gifts. Consumers might notice the shift from last year’s discounts and prices compared to this year. With a new fiscal year approaching, only time will tell how this new financial year will start. If you weren’t one of the lucky ones to partake in the early sales, it’s best to start the research now for upcoming holiday gift exchanges.
Sharon Schweitzer and Esther Sanchez co-wrote this post. Sharon Schweitzer, J.D., is an award-winning entrepreneur, cross-cultural trainer, and the founder of Access to Culture. In addition to her accreditation in intercultural management from the HOFSTEDE Centre, she serves as a Chinese Ceremonial Dining Etiquette Specialist in the documentary series Confucius was a Foodie, on Nat Geo People. She is regularly quoted by BBC Capital, Investor’s Business Daily, and Fortune. Her Amazon #1 Best Selling book in International Business, Access to Asia: Your Multicultural Business Guide, (3rd printing), was named to Kirkus Reviews’ Best Books of 2015. She’s a winner of the British Airways International Trade Award at the 2016 Greater Austin Business Awards.
Esther Sanchez is a Fall 2017 Cross-Cultural Communication intern with Access to Culture. She is currently attending the University of Texas at Austin as a Journalism major and working to earn a minor in Middle Eastern Studies and a certificate in Computer Science. She plans to use these skills to tell stories through virtual reality from around the world. You can connect with her on LinkedIn or Facebook, Instagram or Twitter.
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