Goods and Service Tax (GST) is an indirect tax in India imposed when a customer buys a good. GST is regarded as an indirect tax imposed on the sale, manufacture, buying of goods. The aim of GST is to remove all the indirect taxes imposed on goods by the Indian Central governments and State governments.
GST (Goods and Service Tax) in India is regarded as one of the largest taxations that has taken place in India and also passed by the Indian Government. India has adopted two GST that means GST will be administrated both by the State Government as well as by the Central Government.
In keeping the federal structure of India, it is proposed that the GST will be issued both by the Central Government (CGST) and the State Government (SGST). Prime Minister Narendra Modi introduced GST in India on the midnight of 1st July 2017.The development of GST took many negotiations as well as revisions before getting launched in India in its final form in the year 2017.
The current situation of India is that there are taxes present at various rates and in different stages like the Centre has the taxes like Service tax, Income tax, Central sales tax, Security transaction tax etc. and on the other hand the State has entry tax, agriculture tax, property tax. The increasing of taxes at different level affecting the selling as well as the rates in domestic and in the international markets.
Some of the positive impact of GST on the common man & the Indian economy are as follows:
- GST increase in export by removing the custom duties applicable to exports.
- GST supports Small and medium- sized enterprises (SME).
- GST increases revenue by extending the tax base.
- GST enhanced Pan India operations.
- GST reduces burden of tax on producers and increases the growth through more production.
- GST provides transparency as the customers will exactly know about the taxes they are being charged.
- GST abolishes the cascading effect of tax.
- GST defined treatment for the operators of E- commerce.
- GST has reduced taxes on some goods by 2% while on the other hand it reduces taxes on other goods such as smartphones and cars by 7.5%.
Some of the negative Impacts of GST on the common man& the Indian economy are as follows:
- One has to submit the GST and file the return on time which is regarded as a burden.
- The filing of GST return is not so simple, one must appoint a tax profession to be dealt with.
- One’s monthly cost gets increased with the increasing service cost.
- The recent tax system in India puts negative impact on the consumption, demand, tax rate, rate of unemployment in India, inflation rate and the circumstances are not at all good for common man.