Thursday 17 August 2017

10 Brilliant Ways in Which GST Can Help You

GST has become a buzzword nowadays. Since its bill has been passed by Rajya Sabha, and specially since its implementation from 1ST July, everywhere you go, you can hear some groups talking about this topic. And why they shouldn’t be? After all, it is one of the most significant fiscal reforms made in Indian economy till date.
10 Brilliant Ways In Which GST Can Help You

Some of the amazing ways in which GST will come up as a friend to the common mass are:

1.Count out Multiple Taxes: GST eliminates numerous taxes at one go. Earlier, you had to pay VAT, Sales Tax, and others to buy a product. With GST coming into effect, only one tax is levied upon the goods- GST, and nothing else. It has fully replaced all 17 taxes enabling you to pay only one.

2.Minimize Prices of Goods: No one has to pay double taxes to get a single product. It means the overall costs of the goods will decrease considerably. So, you can save more while shopping generously. Applicability of GST eliminates the payoff of double taxes for a single product. This enables you to pay less and hence, enjoy more savings.

3.Help Interstate Businesses: GST has brought the concept of one tax paying. Consequently, the rat race among different businesses will be reduced. One common market will be created where there will be no entry tax or CST. When the businesses will be exempted from paying CST, they will feel motivated to sell their quality manufactured goods across the country. As a result, the customers will be able to purchase world-class indigenous products without paying extra.

4.Bring Down Inflation: Hasmukh Adhia, the Revenue Secretary, while giving an interview to PTI has said that the introduction of this GST will make inflation fall by 2%. In this way, it will improve the country’s economy gradually. Moreover, according to him, the initiative taken by PM Modi, ‘Make in India’ will also get the needed fillip. Ultimately, India will grow as a manufacturing hub in the near future.

5.Escalate Job Opportunities: Sectors like logistics, automobiles, cement, and eCommerce will witness huge profits. Thusly, these fields will intake unemployed youths to accelerate their profits rate. Team Lease Services, a recruiting firm, has conducted a study on how the implementation of GST will impact the employment of the country. However, they have come to the conclusion that the single tax (GST) will play a crucial role in creating huge job opportunities. Approximately, 11-18% of more vacancies will be there every year in the sectors mentioned above.

6.Uplift GDP: Direct cost reduction due to GST indicates that GDP can experience a growth of up to 2.5% every year, provided it is designed rightly. It, in turn, will boost the exports by at least 10%. In this regard, Adi Godrej, the active proponent of GST, is quite hopeful that GDP will grow by double digits as the whole tax system has been unified. While staying positive about this unified tax, he says that initially GDP may suffer a loss. However, in the long run, it will surely bring profits.

7.Increase Revenue Collections: The improved tax compliance will increase the revenue collections. It will create a positive impact on the credit profile of the country. Consequently, different countries will come forward to invest in India mainly because of its lenient structure of taxation. This will boost the revenue that come from export by almost 11%. Tax collection to the government will be raised, and it will boost the generation of revenue.

8.Reduce Corruption: De-centralization of power causes a significant decrease in the level of corruption in the country. Corruption that occurs in various tax departments is directly related to tax evasion. State and Central government officials control the rate of GST. Unlike other taxes, it will consist of a paper trail. Income Tax department can easily access this paper trail to see whether black money is generated in the system or not.

9.Make Product Identifying Process Easy: Prior to the implementation of GST, products were classified into several categories. These different categories were creating many confusion not only among the buyers but also among the retailers. To fix this problem, HSN or Harmonized System of Nomenclature was introduced by GST. This nomenclature system is actually a code consisting of eight digits. It is through this code that the product identification process has been made easy by remaining stick to the global standard.

10.Encourage Competition in Product Manufacturing: Multiple taxes that are imposed on a product has weakened its earnings from foreign as well as local markets. The toll taxes between two states was delaying its delivery process. Hence, many companies established small storehouse in those states for ensuring quick delivery. However, with the replacement of 17 taxes with one simple tax, GST, consumer demands are sky-rocketing. Consequently, it encourages different manufacturers to produce world-class products to gain a strong foothold in the market. When the quality of manufactured products will be high, India will be able to give a tough competition to the major manufacturing hubs like Philippines and China.

Wrapping Up

Most of the economists are speaking in favor of Goods and Services Tax today. They believe that it will create a balance between the varied prices of goods. Besides, it will reduce the household budget too by bring down the cost of daily needed goods.
To make noticeable improvement in Indian economy, the role GST is playing and will play in the near future cannot be overlooked. Indeed, it has come as a blessing to the consumers. However, it is not prove beneficial only for the consumers but also bring enormous profits to the companies that are GST registered. By removing the barriers among the retailers and customers of various states, it has indirectly, strengthened unity and nationhood among its citizens. You won’t be wrong in assuming that it is through GST that the dream of creating one economic India has come true.

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