Moody's "Over the medium term, we expect that the GST will contribute to productivity gains and higher GDP growth by improving the ease of doing business. The GST will also support higher government revenue generation through improved tax compliance and administration. Moody's has a 'Baa3' rating on India with a positive outlook.
It will definitely act as the booster for the Indian economy. It will be helpful for our nation to increase GDP. These future aspects show the substantial increase in economic growth. The tax will be charged on value addition only. This will lead to lower down the cost of products and services.
After the introduction of GST lawthe customer is now able to know that what is the actual tax he is paying for the product or services. In existing taxation law, more than one taxes are levied on many goods and services and they were not even mentioned in the invoices many times so customers are not able to know that what is the actual amount they were paying as taxes.
The problem of ITC mismatch will also be prevented. It will prevent black money accumulation which will lead to more revenue collection for the government. More revenue collection to the government will definitely lead to infrastructure development in many backward states.
Which in turn will attract more industries to the country and will help our economy to grow and develop? Similarly, service tax credit cannot be used for paying tax like VAT etc.
So in GST law, there will be single tax levy so credit can be easily availed. International Tax Competencies After the introduction of GST, Indirect taxation of our country will be competent in the international market.
This tax reform will also make our country become one of the preferred destinations for the investment purpose for big investors. New investments will lead to developing our economy as it will also provide for new employment opportunities.
Sectors like media, telecom, automobile etc. Due to the elimination of the cascading effect of taxes, the cost has reduced eventually.
Manufacturers are not passing on the benefit of cost reduction to the consumers. For media sector, GST will prove to be so much fruitful as will be able to take input credit of service tax paid by them.
This will ultimately result in overall cost reduction. Earlier, there is the tax rate on automobile industry which is around 30 to 45 per cent. After GST law the rate is around 18 per cent and there is a reduction in logistics cost also.
So in long run, the automobile industry will be benefited to a great extent. Due to overall tax savings, the cement industry will also get a boost as overall tax rate has decreased since the introduction of GST.
Due to the introduction of the single rate the process to administer tax will also become simplify. Compliance cost will also get reduced. For increasing the better facility for infrastructure the new tax reform will help them.
Objective of GST must be to boost tax efficiency November 4, , am IST Jaideep Mishra in Figuring It Out | Economy, India | ET These days in Delhi, the accent seems to be on tax design. Impact Of GST on Indian Economy Expect reduction in prices of: FMCG goods such as shampoos, chocolates Eating out Small cars DTH Increase in prices of: Boost to export /manufacture activity, generation of more employment, leading to reduced poverty and increased. Aug 09, · GST will boost India's economy: Godrej August 09, IST Noting that there is a huge potential in the agricultural sector, he said value .
Corruption will also get reduced as under the existing system there were multiple tax levies by many different authorities like checkpoints between interstate borders. So this corruption practice has been eliminated due to nation wide single tax applicability.GST Reduction Boost Economy Essay Though sales taxes are a substantial source of revenue for government, sales tax cut can eventually help economy to grow - .
International Finance Discussion Paper Note March The Effect of the GST on Indian Growth analyzing these e ects through a reduction in domestic and international trade barriers.
Finally, this The main purpose of the GST is to eliminate the compounding e ect of the current multilayered. Impact Of GST on Indian Economy Expect reduction in prices of: FMCG goods such as shampoos, chocolates Eating out Small cars DTH Increase in prices of: Boost to export /manufacture activity, generation of more employment, leading to reduced poverty and increased.
Economic impact of recommended GST: If GST is implemented as per the Chief Economic Adviser (CEA), Arvind Subramanian panel’s report, it will benefit the economy in several ways. GST will help to create a unified common national market for India, giving a boost to foreign investment and “Make in India” campaign.
It will prevent cascading of taxes and make products cheaper, thus boosting aggregate demand. Read the latest breaking financial and political news stories from Australia and around the world. Visit the website to find out more.