The Goods and Service Tax (GST) bill is touted to be the biggest reform in India’s indirect tax structure since 1947. The GST is basically, one indirect tax for the whole nation, making India one unified common market. It is a single tax applied on the supply of goods and services, starting from the manufacturer and till the consumer. Taxes such as excise duty, service, central sales tax, VAT (value added tax), entry tax will all be subsumed by the GST under a single umbrella. GIBS enrich the students related to GST in their financial subject. GIBS creating a platform for the MBA students enriching them relating to Finance & GST which lead to have great learning experience as they came to know various aspects in the finance sector.
The GST is expected to be instrumental in growing India’s GDP by 2%. The GST also offers a solution to the multinationals as it breaks down the indirect tax structure into one single tax payable by the companies.
Put simply, the prices we pay for goods and services already have the taxes included. In most cases, the consumer may not even be aware of the tax they pay for the things they buy. A maze of indirect taxes leads to this complexity. The GST will untangle this and subsume all in one single tax, making India an economically unified market.
Under the current system, there is the cascading effect or double taxation – the consumer pays tax on tax already paid by the manufacturer, which is embedded in the prices. This makes the consumer pay higher tax, and in turn pay higher prices. With GST, this anomaly will be corrected, thus bringing down the end price. Competition between the players will play a role in the reducing the prices further. This is expected to be beneficial for the consumer. An increase in consumption demand will boost the economic growth.