Impact of Modern Taxation Policy-GST | Best MBA college in Bangalore

Posted by Suganya.S On 07/02/2022 10:02:34

GST, the biggest tax reform in India founded on the notion of “one nation, one market, one tax”. Fundamentally, the $2.4-trillion economy is attempting to transform itself by doing away with the internal tariff barriers and subsuming central, state, and local taxes into a unified GST. The idea behind implementing GST across the country in 29 states and 7 Union Territories is that it would offer a win-win situation for everyone. Manufacturers and traders would benefit from fewer tax filings, transparent rules, and easy bookkeeping; consumers are paying less for the goods and services, and the government is generating more revenues, as revenue leaks are plugged. Best MBA college in Bangalore

Countries where the Goods and Service Tax has helped in reforming the economy, apply for only 2 or 3 rates – one being the mean rate, another being a lower rate for essential commodities, and a higher tax rate for the luxurious commodities. Currently, in India, we have 5 slabs, with as many as 3 rates – an integrated rate, a central rate, and a state rate. In addition to these, cess is also levied. The fear of losing out on revenue has kept the government from gambling at fewer or lower rates.  A++ Rated MBA college in Bangalore

According to some of the media channels, Finance Minister Nirmala Sitharaman, on Tuesday (February 1), said that the gross GST collections for the month of January 2022 at Rs 1,40,986 crores are the highest since the inception of GST. GST collection in January had witnessed a growth of 15 percent over the year-ago period, on pickup in economic activity and anti-evasion measures. Speaking to the budding entrepreneurs in the fabric industry, got to know how happy they are in terms of GST. As per their knowledge, one nation's one tax policy made it easier for them to understand the concepts of GST and taxation policy in India. Later they told me how people were unaware of the taxation policy in the country, due to many taxation policies people were not taking efforts to pay taxes in the country, which further led to many unethical ways to get relief for taxes in the country. GST made such people more aware of taxation policy plus made their work easier, rather hassle-free. The replacement of multiple indirect taxes in the country has helped India's Government achieve its "One Nation One Tax" program. In the Textile industry, the government was in action to make the GST 12% during the budget session but satisfied keeping old norms as a new one in this field. 

During expert discussions, that were going on Doordarshan on 30th June 2021 G.D LOHANI, Joint secretary of GST said that, due to GST into action in our country, a normal consumer is now saving 4 % more in a month. India's economic growth in the current year is estimated to be 9.2 percent, the highest among all large economies. When considering GST and its impact on the Indian economy, customs duty on exporting goods has been reduced. So now production units save money while producing goods and also while shipping them. This two-way savings has lured many production units to export their goods, increasing the export quantity. Currently, the implementation of GST has been good. As per the “One nation, one tax” principle, GST has effectively reduced the cascading tax effects. Moreover, it has automated the indirect tax-paying system for goods. The 15th Finance Committee has highlighted some concerns: tax rate diversity, inadequate collection of GST compared to forecasts, high volatility of GST collection, and several inconsistencies. Continuity in the flow of credits entry and compliance procedures has been affected by IT glitches. Indirect taxes do not distinguish between rich and poor; therefore, it increases the burden on poor people. Moreover, SMEs are still struggling with the shift towards technology. The GST law is still in development mode, and evolution in such complex processes cannot be just ruled out. The Indian Government must continue to act to make this tax regime promising soon. 

 

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