How Has The GST Implementation Affected The Indian Economy In Its First Year?
The aim of the goods and service tax was to create a business sphere where free and fair competitions would dictate the Indian economic pace. The goods and service tax happens to be India’s greatest tax reforms since the nation gained independence. Since its implementation on July 1 2017, it has been followed by mixed reaction on how it has affected the economy. The new tax structure was geared at transforming the nation’s economy with its 1 nation, 1 market and 1 tax modality by absorbing a number of indirect taxes levied at different rates by states as well as centres by introducing uniformity into the nation’s taxation.
Impacts of the new tax structure – how has the goods and service tax affected the Indian economy
GST marked a new era in India’s economy and the results have been felt by consumers as well as manufacturers. The major talking points include;
This is considered as one of the key rationales behind the implementation of the GST. The retail cost of goods and services manufactured in India reveals that the tax component of each item is about 25 to 30 percent. The implementation of the GST has witnessed a notable reduction in prices because the tax burden on the producer has been chopped off.
Win-win situation for everyone
The implementation of the goods and service tax in India has benefitted everyone. As many as seventeen taxes and levies have been liquidated by the goods and service tax fine-tuning India with the best global practices. Central taxes such as service tax, excise duties, state taxes, surtax, Oct roi tax, value added tax and the others have been fused into one. The new tax regime has not only allowed for a free flow of tax credits it has boosted the ROI of manufacturers and reduced the purchase price for consumers.
The uniformity that the goods and service tax introduces to the Indian economy is commendable. After absorbing the numerous taxes, the goods and service tax has simplified the whole process of tax payment. The uniform procedures and rules have expelled the burden of resistance and it has resulted in an increased level of compliance. The extensive range of numerous taxes at various junctures of the supply chain usually confuses the tax payer but the goods and service tax has provided for a better perception and understanding.
Easy financial management
One of the major implementation of the goods and service tax is that businesses in India can now manage their finances with the aid of the GST accounting software. Businesses can keep tracks of their tax records using different business accounting software as well as a range of QuickBooks alternative. The implementation of the goods and service tax has alleviated the usual practice of overburdening the online accounting software used by business to manage the plethora of taxes they initially paid. Whether the producer opts for a free accounting software or the GST accounting software, the uniform tax structure has provided for more focus and easy financial management.