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. It is a form of indirect tax that has removed many indirect taxes in India like the VAT, services tax, excise duty etc. The GST was passed on 29th March 2017, in the Indian Parliament and came into force on 1st July 2017. India has adopted two GST that means GST will be administrated both by the State Government as well as by the Central Government.
The Goods and Service Tax (GST) is basically imposed on the supply of goods and services. GST is a single domestic indirect tax law for the entire country. Under the GST, the tax is imposed at every point of sale. The journey of GST started in the year 2000 when a committee was formed to draft law. From 2000 it took 17 years for developing the law. Finally, in the year 2017, the GST Bill was passed both in the Rajya Sabha and Lok Sabha and on 1st July 2017, the GST Law became effective.
Supply Chain Management (SCM) is known as the oversight of materials, information, and finances as they move in a process from supplier to manufacturer to wholesaler to retailer and then to the consumer. The three main flow of the supply chain are as follows:
Information flow and
However, apart from creating a combined market across India, the GST will help to make India’s manufacturing competitive by eliminating high logistics as well as warehousing costs. The supply chain segment associated with getting the finished product from the manufacturer to the consumer is regarded as the channel of distribution.
The impact of GST on the supply chain in India are as follows:
Customisation of Supply Chain.
Superior Inventory Management.
A decrease in incoming logistics costs.
Cash flow management for export businesses.
Modified after-sales distribution models.
However, the supply chain management industry has been promoted as one of the chief recipients of GST implementation. According to the rules of GST, the supply chain network design would be purely based on logistics cost and customer service and allows a greater flexibility into Supply and Demand matching and this would lead to combine many small warehouses and have bigger, fewer, and also highly efficient warehouses. Moreover, this would also help to reduce the share of unorganized sector in warehousing.
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