India is considered to be one of the fast-growing economies in the last two decades. During this period though, there are many bright points of the rapid growth and development, but there are still some dark spots or you can say major challenges which are faced by the rural sections of the society and the distribution of income among the have-nots in urban areas. An introduction of a well-judged tax reform policy( GST) by the government will be helpful in creating new opportunities and equal distribution of income. The impact of GST on the Indian economy aims to achieve employment in various sectors of the Indian economy and the proper allocation of resources.
What is good and services tax or GST? What are the various impacts of GST on the common man?
GST or it can also be termed as goods and services tax can be defined as an indirect tax on goods and services at the same rate, it means that the GST will be implied to both goods and services at the constant rate and both will be treated at the same level. The GST would be implied as one tax eliminating various other indirect taxes such as – CSD, VAT, service tax, etc. GST has been brought to fight new challenges, hence it should be executed carefully and efficiently. By replacing other indirect taxes, GST has simplified the process of indirect taxation. The slogan of one tax, one nation, one market is now very well designed by our nation.
Let’s take a look at some major points subjected to the impact of GST on the ultimate consumer or common man:
- GST reduces the falling impact of taxes, for eg- implying tax on tax.
- Due to the reduction in the costs, some of the luxury items has now become cheap and can be afforded by the common man.
- This will decrease the burden on the common man, as the customer will have to spend less money on the same product which was very costly earlier.
- The production of more goods will lead to more number of jobs in the future, which can only be possible if the consumer gets the goods at a cheap price.
GST considered to be a beneficiary step taken by our government, let’s take a look at the significant effects and benefits of GST on the Indian economy.
Benefits of the GST on the Indian economy as a whole
The introduction of GST will result in the growth of GDP( gross domestic product) and also will help in removing various multiple taxations, increase the overall revenue generated and also reduce the rates at which the taxes used to be imposed. The positive impact of GST will also help in generating anti-corruption measures which including the demonetization of a large number of notes and also digitization of online transactions, the impact will also add up to the expansion of construction and communication networks and also the development of other various shipping and rail networks. Tax policy aims at building a common market and will boost the export and commerce of the country.
Benefits of GST on the businesses and the consumer
The effect of multiple taxes charged on various points earlier has made it difficult for all the businesses operating in India. One of the highlighting benefits of GST is that it is uniform throughout the country and is a simplified form of indirect taxes.
GST considered to be a uniform system of indirect taxes helps in providing important information without any hampering and thereby helps in creating a translucent environment. With the imposition of multiple taxes on various stages, the pricing for the nd consumer was more and affecting the budget of the consumer. GST helped in lowering the prices of various commodities and also decreased the burden on the economy.
The various boons of GST provided various benefits to the various sections of the society, which helped in boosting the Indian economy.