top button
Flag Notify
    Connect to us
      Facebook Login
      Site Registration

Facebook Login
Site Registration

Who all get benefits from GST (Goods and Services Tax), if it get passed in this monsoon session?

+1 vote
Who all get benefits from GST (Goods and Services Tax), if it get passed in this monsoon session?
posted Aug 1, 2016 by Amit Kumar Pandey

Share this question
Facebook Share Button Twitter Share Button LinkedIn Share Button

1 Answer

+1 vote
Best answer

Following are benefits of GST -
1. Life gets simpler - GST will replace 17 indirect tax levies and compliance costs will fall.
2. Revenue will get a boost - Evasion set to drop. Input tax credit will encourage suppliers to pay taxes. States and Center will have dual oversight. The number of tax exempt goods will decline.
3. A common market - It's currently fragmented along state lines, pushing costs up 20-30%.
4. Logistics, Inventory costs will fall - Checks at state borders slow movement of trucks. In India, they travel 280 km a day compared with 800 km in the US.
5. Investment boost - For many capital goods, input tax credit is not available. Full input tax credit under GST will mean a 12-14% drop in the cost of capital goods. Expected: A 6% rise in capital goods investment, 2% overall.
6. Make in India - Manufacturing will get more competitive as GST addresses cascading of tax, inter-state tax, high logistics costs and fragmented market. Increased protection from imports as GST provides for appropriate countervailing duty.
7. Less developed states get a lift - The current 2% inter-state levy means production is kept within a state. Under the GST national market, this can be dispersed, creating opportunities for others.
8. Manufactured goods could become cheaper - Lower logistics and tax costs.
9. GDP Lift - HSBC estimates an 80 basis point rise in GDP growth over 3-5 years. NCAER pegs this at 0.9-1.7% thanks to the elimination of tax cascading.
10. Freeing up online - State restrictions and levies have complicated ecommerce. Some sellers do not even ship to particular states. All this will end with GST.

answer Aug 3, 2016 by Salil Agrawal
Contact Us
+91 9880187415
#280, 3rd floor, 5th Main
6th Sector, HSR Layout
Karnataka INDIA.