Introduction
the Goods and Services Tax (GST) is a value-added
tax imposed on most goods and services sold for
domestic intake. The GST is paid by consumers, but
it is remitted to the government by the businesses
selling the goods and services. In effect, GST offers
revenue for the government. The goods and
services tax (GST) is an indirect sales tax that is
applied to the cost of certain goods and services.
The business adds the GST to the price of the
product, a customer who buys the product pays the
sales price plus GST; and the GST share is collected
by the business or seller and furthered to the
government. Initially France implemented GST to
decrease tax-evasion. Now, more than 140 nations
have initiated GST with some nations having Dual-
GST, for example Brazil and Canada. India has
preferred the Canadian model of dual GST as it has
a federal structure where the Centre and states
have the powers to charge and collect taxes.India
joins the GST group on July 1, 2017.
Literature Review
Ehtisham Ahmed and SatyaPoddar (2009) in their
study on “Goods and Service Tax Reforms and
Intergovernmental Consideration in India” found
that GST introduction will provide simpler and
transparent tax system with increase in output and
productivity of economy in India. however the
benefits of GST are depend on the rationally
designed GST. Dr. R. Vasanthagopal (2011) in his
research paper “ GST in India: A Big Leap in the
Indirect Taxation System” concludes that switching
to seamless GST from current complicated indirect
tax system in India will be a positive step in
booming Indian economy. Syed Mohd Ali Taqvi
(2013)“Challenges and Opportunities of Goods
andService Tax in India” the researcher explains the
GST is only indirect tax thatdirectly affect all sectors
and sections of our country. It is aiming at creating
asingle, unified market that will benefit both
corporates and
Need for GST
India’s latest progress towards economic growth
stems from reforms undertaken after the 1991
fiscal crisis, which lifted India from years of slow
growth under socialist rule and open an
opportunity to progress living conditions in the
immense, poor country. At the same time much
had improved in India after the balance of
payments crisis of 1991. Indian policies became
more positive about encouraging export and
permitting foreign capital to participate in the
process of India’s growth. Globalization and
liberalization have turn out to be order of the day.
The interdependence of economies in their transfer
for development compelled the Governments of all
the countries to follow the globalization policies
accepted by the major economies of the world. To
survive and grow in this economic order rational
and competitive tax policies are being accepted by
every country. India has also fallen in line with the
requirement and has been introducing
modifications in direct and indirect taxes. The
recent applications of Direct Taxes Code (DTC) and
Goods and Services Tax (GST) are
Objectives of the Study
1) To have a brief understanding on GST
2) To understand how GST will work in Indian
Economy System. 3) To know the advantages and
disadvantages of GST in Indian context.
4. Research Methodology The study is descriptive
and exploratory considering the objectives of the
studythe data collected are secondary source of
data like Journals, Newspapers andGovernment
Reports.
How GST is applied
GST is an intake based tax/levy. It is built on the
“Endpoint principle.” GST is applied on goods and
services at the place where final/actual
consumption happens. GST is collected on value-
added goods and services at each stage of sale or
buying in the supply chain. GST paid on the getting
of goods and services can be set off in contradiction
of that payable on the supply of goods or services.
The manufacturer or wholesaler or retailer will pay
the related GST rate but will claim back through tax
credit mechanism. But being the last person in the
supply chain, the end consumer has to bear this tax
and so, in numerous respects, GST is like an end-
point retail tax. GST is going to be collected at point
of Sale.
Conclusion
No doubt the GST by subsuming large number of
indirect taxes and having a uniform Indirect tax
structure throughout the country will definitely
boost up economic unification of India. Again with
better conformity and revenue resilience GST will
evade the cascading effect in Indirect tax regime. It
is preferred every economy must adopt GST or VAT
at national level to make their economy attractive
for foreign investors. History has proved that many
countries have benefited from moving to a GST
regime. In India, Execution of GST would also
significantly help in removing economic biases
caused by present complex tax structure and will
help in progress of a common national market. By
instigating GST, the developing economy like India
can accomplish sustainable and balanced
development.
