The GST or the Goods and Services tax is considered to be an indirect tax that is to be applied to the goods and services sold, consumed or manufactured. The indirect taxation policy is being revamped so as to introduce the GST. This tax is to be levied at the central level as well at the state level removing all other indirect taxes and is proposed to be implemented throughout in India. The indirect taxation in India will considerably change if the GST is introduced. It will bring a uniformity all over the economy since there will be only one source of indirect taxation instead of many taxation policies. This will also simplify the taxation policies and the administration procedures within the economy. The consumers will be relieved from the tax burden policies if GST is successfully implemented.
It is believed that the tax rate for GST would be low as compared to what it exists in the current scenario. Proper and efficient implementations are being developed and technologies are being improvised in the IT platform in order to implement the process of goods and services tax smoothly. The implementation of GST will change the Indian economy effectively making the tax base comprehensive. The government of India has committed to implement the GST by 2016 and is considered to be one of the most important tax reforms. It will be implemented both at the state and the central level thus leading to rising in problems in the economy.
 |
| Image credits: Telegraphindia.com |
The current tax scheme is unfairly skewed among the producers; the introduction of GST will bring in a system that will collect tax from the producers at all levels of production. Since the VAT rate is different for various states so it sometimes results in loss of revenue within the country; the implementation of GST would rule out this disadvantage as it is a uniform source of taxation and would result in capital formation effectively. The dual model of GST would be implemented in India because both the centre and the state would levy GST.
If GST is successfully implemented then the country will benefit a lot from it. It would generate more job opportunities; loss in revenue would be reduced, economic growth and development. It would also eliminate the cascading effect of taxes which means “taxes upon taxes”. Introduction of GST would simplify trade and consumption, eliminate economic deviations, and simplify administration. It will act as a replacement for all the forms of indirect taxes thereby making the economy more functional and efficient.
Article by Anisha Dutta
She is a content evangelist who believes that the Science of today is the Technology of tomorrow.
She can be reached at https://twitter.com/Anisha_Dutta29
