Goods and Service Tax (GST) is a comprehensive Indirect Tax regime, applicable to manufacture, sale and consumption of goods and services at national level. It will replace all the indirect taxes levied by central and the state separately thus, bringing in a uniform tax structure.
There would be 4 tax slabs under GST i.e, 5,12,18,and 28 percent. The council is yet to decide which goods will fall into which slab. The tax rates are expected to be in lines with current tax rates to keep the inflation in check. Essential items such as food will be taxed at zero- rate.
With GST marking its foot soon,
Here are some Benefits to expect from GST
1.Benefits to the consumer:
Consumers will no longer be subjected to double taxation by the centre and the state. As a result, the overall tax burden would be reduced. The lower tax burden would lead to cheaper goods that would leave the consumer with higher purchasing power that will lead to more demand which would directly result in increased production that will increase the overall economic GDP.
2.Sectors stand to Gain the Most under GST:
Logistics companies stand out to be gainers with onboarding of GST. other companies that stand to gain are electricity, Pharmaceuticals, Retail, Automobiles, Media Entertainment and cement industries.
3.Benefits to the Businesses:
GST will facilitate ease of doing business in India. Amalgamation of multiple taxes into single tax will significantly reduce the cost of tax compliance and transaction cost. Stable and transparent tax regime will encourage local and foreign investors in India thereby creating opportunities.
4.Impact on the Economy:
GST will be the game changer for the Indian economy. By subsuming all the indirect taxes into one single umbrella will to a larger extent reduce the cascading effect on the goods and services. It will have far-reaching effects on the business operations in the country.
GST has been an eagerly Awaited Tax reforms since India opened up its economy. The introduction of GST would significantly contribute to the economic growth.