Published on august 16, 2016 august 16, 2016 14 likes 0 comments. The final consumer will thus bear only the gst charged by the last dealer in the supply chain, with setoff benefits at all the previous stages. The goods and service tax has finally become real as the council and all the dignitaries have concluded over most of the laws. An economic pros and cons of goods and service tax gst in india. Explore gst s pros and cons profile at times of india for photos, videos and latest news of gst s pros and cons. This will clarify only after the final draft of the bill. Implementation of goods and services tax gst was one of the long. Assistant professor in economics, national college autonomous, trichy1 abstract world over in almost 150 countries there is gst or vat, which means tax on goods and services. For essential goods like food, gst will be 5%, and for luxury goods, gst will be 28%. But the implementation of gst definitely gives more benefits to both business people and customers. Gst has ensured that multifarious industries come under uniform tax law which has made it much easier for businesses to function. What are the likely pros and cons of the goods and services.
Pros and cons of new gst bill in india posted on december 15, 2015 january 4, 2016 simple posted in news gst, at a broad level, is expected to be beneficial to all stakeholders corporate entities, consumers, government and the overall economy. Gst charged by the last supplier in the supply chain, with set off benefits at all previous stage, so burden borne by the final consumer. That shall come across as a simpler term to envision. Online export import data search select period last day last week last month last year last 7 days last 30 days janmar 2016 janmar 2014 janmar 2015 custom.
The goods and services tax is a unified, destinationbased tax that was implemented in india from july 1, 2017 to effectively replace all the existing indirect taxes, including service tax and vat. The proposed constitutional amendment to indias gst bill will radically change the countrys taxation system. To download the above complete paper in pdf format click on below link. Gst goods services tax india rajyasabha modi pros cons what is gst. Starting a business understanding gst, pst and hst. A better supply chain mechanism would ensure the reduction in wastage and cost for the farmersretailers. Aug 16, 2016 impact of gst, the pros and cons on each sector. Pay gst back on any assets you keep when you deregister or cancel your gst registration. Gst is a transparent tax and also reduce number of indirect taxes. In simple words, goods and service tax gst is an indirect tax levied on the supply of goods and services.
From 1 july, a very complicated network of indirect taxes in india will be replaced by a uniform goods and services tax gst. One of the chief advantages of gst is that the taxpayers can register, file returns and pay taxes all online with the gst portal. Top 10 advantages and disadvantages of gst tax in india. An economic pros and cons of goods and service tax gst in india k. Aug 01, 2017 our nation recently met the biggest economic reform of modern times gst. Research report the pros and cons of taxing sweetened. Composition scheme has a lot of benefits to small traders and businesses. Advantages and disadvantages of gst business alligators. Key advantages and disadvantages of gst for businesses. Gst was introduced as part of the constitution bill one hundred twenty second. All the necessary steps are being taken for the effective implementation of gst or goods and services tax from july 2017 in india. Boosting revenue under the gst, the tax is compulsorily paid by the business people, no one be escaped. Like any other system, gst has its own pros and cons.
The government of india, in their effort to simplify the taxation process and bring transparency into the system, will soon introduce goods and services tax gst in india. So it will helps to all kinds of business people to buy most of the commodities at low prices compared to previous rates. The taxation regime significantly has removed all the additional tax currently levied on the interstate movement of good and also the states will compensate if any revenue loss occurred in continue reading gst in india vs other countries. Gst is a kind of vat that would incorporate every other within a single channel within the entire zones in india. Thus, the complexity for businessmen has increased across the nation. It aims at complete restructuring of intricate and colossal taxation policy in india. The gst will overall act a catalyst for the startups and will majorly boon the small and medium enterprises. Dec 15, 2015 pros and cons of new gst bill in india posted on december 15, 2015 january 4, 2016 simple posted in news gst, at a broad level, is expected to be beneficial to all stakeholders corporate entities, consumers, government and the overall economy. This study discusses the gst, its contribution and aftereffects to the overall growth of indian economy. This article covers the gst pros advantages and cons disadvantages. Short and simple goods and service tax gst essay 2018. Gst disadvantages the cons of gst registration can be summarized as.
Everything about selling online in india at one place. A person can obtain registration under gst as normal taxable person and also as input service distributor. Essay on positive and negative impact of gst goods and. Opinion pros and cons of four tier tax structure in gst multiple rate structure is desirable for a country like ours in which larger population belongs to lowermiddle class. Goods and services tax gst bill is a constitutional amendment bill which aims at complete overhauling of the indian indirect tax regime. Gst directly affects the running of businesses as well as the consumers in the country. It is a unified and destination based tax eliminates all the indirect tax, service tax, and vat. In evaluating the pros and cons of alternative approaches one should keep in mind. We here would look into gst taxation in brief and deal with its advantages and disadvantages. Gst is essential to improve the transparency, reliability, timeline of supply chain mechanism. Goods and services tax gst is one of the biggest tax reform levied on goods and services sold in the country. An isd has to distribute the input tax credit to its concerned units in the same month in which such inward supplies have been received. Central and state economies, indian economy, indirect taxation international market, taxation system.
Gst in india difference in indian gst vs foreign gst. Pdf the goods and service tax gst is a value added tax vat to be implemented in india from july, 2017. Under the gst scheme, no distinction is made between. The gdp of a country reflects economic efficiency and growth over a period of time. Integrated gst igst charged by the centre for transaction of goods and services between states. Gst stands for goods and services tax levied by the government in a move to replace all of the indirect taxes. Theyll help you to weigh the pros and cons, and come to the right decision for your business. Like all the other things there are some pros and cons of gst bill. Gst, touted as the biggest tax reform in the independent india, is likely to pass in the rajya sabha today, and the current dispensation is planning to implement it from 1st april, 2017. Gst and its benefits have provided long term returns for the indian economy on a large scale which have been welcomed as a new change by all the stakeholders. Gst s broad tax base not only results in higher collection, it also increases transparency and mitigates leakage thanks to its fixed standard rate after all, gst is widely implemented in many countries around the world and is lauded as a modern consumption tax compared to sst.
Pros and cons of four tier tax structure in gst multiple rate structure is desirable for a country like ours in which larger population belongs to lowermiddle class shshank saurav 11 november 2016. How to register for gst hst once youve decided that your business should be. A vat tax, or value added tax, is a taxing method that has been used throughout the world since the 1950s. Gst, reforms, tax, business, india, economic growth. Gst is also having three type of taxes and all have to be maintained and this not going too easy for small businessman. The pros and cons india is the second largest consumer market in the world. What are the pros and cons of the introduction of a gst in. The control of businesses has been shifted to the central and state governments for all those businesses binding the laws. The principle behind the vat tax is that a tax is imposed on the buyer all the way up the supply chain of a product from the initial purchase of raw materials through to the retail consumer of the product. Lets first have a brief about what is gst before getting into advantages and disadvantages of gst. Under gst, there would be just one tax rate for each goods and services to be levied by states and central governments. Free 516 words essay on positive and negative impact of gst goods and services tax for school and college students. Pros and cons of composition scheme under the gst all notes. Gst bill advantages and disadvantages in india business.
Will economy grow faster with reduced rates of goods. In short, each state is going to have the same gst rate, or the states cant fix their own rate. Service tends to be more expensive the rate of gst levied on services have increased, thus causing the cost of services to substantially increase. Some indirect taxes are again taxed on the tax account. May 16, 2019 gst in india was a sweeping reform and benefits of gst and has changed the way businesses are conducted. Since 1996 eximguru has been the most authoritative, searchable encyclopedia of india foreign trade rules, regulations and policies. What is the positive and negative impact of gst in india. The gst bill, known as the goods and services tax, was introduced in lok sabha in december, 2014 and was implemented from july 1, 2017. Aug 07, 2016 goods and services tax gst bill is a constitutional amendment bill which aims at complete overhauling of the indian indirect tax regime. There are over a billion consumers, and companies from all over the world are making inroads into this developing nation to get a piece of the action. Lacking the technical knowhow regarding taxes and economies, i was wondering if anyone could explain what the likely pros and cons of this move will be.
Now, lets have a look at the pros and cons of gst system. Aug 03, 2016 gst goods services tax india rajyasabha modi pros cons gst, touted as the biggest tax reform in the independent india, is likely to pass in the rajya sabha today, and the current dispensation is planning to implement it from 1st april, 2017. An agriculturist, for the purpose of agriculture, is not required to register under gst but a better supply chain mechanism would ensure the reduction in wastage and cost for the farmersretailers. The tax will be paid by the end consumer, which makes it a nonconsumerfriendly tax system. Gst reduces various indirect taxes running in the current regime, which will make the process of tax collection transparent and easy. A new bloke on the town of taxation in india is the proposed gst tax which itself is a short acronym for goods and services tax.
Conclusively, the gst has both its pros and cons, and it is expected to bring a positive change in the tax system of india. Above are the gst bill advantages and disadvantages in india and as per me, it will be more comfortable than the existing tax process in india. Impact of gst on indian economy group discussion ideas. For a topic like is it true that gst has impacted small traders the key things you must know are about. Since 1937, our principled research, insightful analysis, and engaged experts have informed smarter tax policy at the federal, state, and global levels. Gst pros and cons in india advantages and disadvantages. The pros and cons of a value added tax vat february 9, 2017. Raakesh saraff, has been hosting this content mostly free for the benefit of export import community. One of the biggest benefits of getting registered under the gst is the reduced tax burden. Nutrition labels, however, currently report total sugar, combining added and naturally occurring sugars.
A study on the impact of gst in fmcg sector with special. Gst stands for goods and services tax gst will implemented in every transaction of goods gst will replace various indirect taxes like value added tax vat, different state taxes, central surcharges, excise duty, entertainment tax, luxury tax etc 3. This study is based on secondary data and references. Gst or goods and services tax is the new indirect taxation system to come into effect in india. Though the government did meet some opposition, they have been able to successfully implement it in july and we have been able to start paying tax already.
Goods and services tax has taken india buy a storm. Simplify the cost price goods and service tax helps to reduce the cost prices of most of the commodities. Even congress wanted to bring it because vat had a huge problem i. Putting aside these pros and cons, the gst council is working hard towards the betterment of gst rules in india for simplifying the process to various businesses.
Gst has reduced the tax revenue of some states as they are now required to share revenues with the central government. Lets discuss the gst registration rules, pros and cons of the composition scheme under the gst. Gst in india was a sweeping reform and benefits of gst and has changed the way businesses are conducted. It has passed the legislation and will sermon from the upcoming financial year. Pdf goods and services tax could be a comprehensive, multistage. The tax foundation is the nations leading independent tax policy nonprofit. The main idea behind introducing gst is to improve the economy of the nation. May 24, 2018 gst has been defined as the biggest step in taxation in indian economy for quite a few years now. Pros and cons of the dual gst it is expected that the final report of the empowered committee in relation to the proposed dual gst will be released towards the end of january 2008. Let the ird know about all the gst you have received for your goods and services. Here we will discuss about the benifits and disadantages of gst.
However, there are many pros and cons in this tax reform. Gst would also help in reducing the cost of heavy machinery. Gst would also help in reducing the cost of heavy machinery required for producing agricultural commodities. Mechanisms for the effective collection of vatgst oecd. It will prove a substitute for the 17 indirect laws pertaining to the nation and will subsidize it with the new gst tax. Some important pointers to keep in mind in the group discussion gd round during an mba selection process. Jan 17, 2008 pros and cons of the dual gst it is expected that the final report of the empowered committee in relation to the proposed dual gst will be released towards the end of january 2008. Regardless of whether you have your hand forced or you want to register voluntarily, the process for becoming gst registered is the same. Natsem, the independent economic research organisation, has said that increasing the gst as mr abbotts liberals want to do, will cost ordinary.
The taxation regime significantly has removed all the additional tax currently levied on the interstate movement of good and also the states will compensate if any revenue loss occurred in the transition. Special economic zones terms and condition with advantages and disadvantages of sez. Pdf impact of goods and services tax on indian economy. The article aims to apprise you of all such pros and cons of gst on the startups to enable you to take you an informed decision. Gst is going to be implemented from july 1st, 2017. Analysis of impact of gst with reference to perspective of small. With gst implemented a business premises can show the tax applied in the sales invoice.
The gst goods and services tax is basically an indirect tax that brings most of the taxes imposed on most goods and services, on manufacture, sale and consumption of goods and services, under a single domain at the national level. Gabriel prabhu, assistant professor, department of pg commerce, introduction now a day, the government implemented goods and service tax in our country. The pros and cons of a value added tax vat tax foundation. Gst bill advantages and disadvantages in india business batao. Pros and cons of four tier tax structure in gst outlook. Pros and cons of gst on the education sector gst india. Just wait for some time to come to know what exactly will be the tax rates of gst in india. Gst will not be a cost to registered retailers therefore there will be no hidden taxes and and the cost of doing business will be lower. Gst will give the advantage of a wider constitutional mandate for comprehensive. Businesses are being included in the formal economy through gst implementation. Simplicity at its best goods and service tax gst will replace the existing form of indirect tax in the nation. Gst pros and cons in india advantages and disadvantages of gst. An economic pros and cons of goods and service tax gst. Gst council will be tasked with optimizing tax collection for goods and services by the state and centre.
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