Goods and Services Tax (GST) is an indirect tax throughout India to replace taxes levied by the central and state governments. It was introduced as The Constitution (122nd Amendment) …
GST will ensure that indirect tax rates and structures are common across the country, therefore increasing certainty and ease of doing business, irrespective of the choice of place of doing business. The uniformity of tax rates throughout the value chain across the country would reduce in transaction costs of doing business would eventually lead to an improved competitiveness for the trade and industry.
Since the central and state taxes are incorporated in GST, the cost of locally manufactured goods and services also reduces which will increase the competitiveness among Indian Goods and services. This will attract the international market towards Indian exports which in turn will boost country’s economy in international trade.
The cost of most goods and services in the country today are loaded with many hidden taxes. Unlike in GST, there would be only one tax from the manufacturer to the consumer, leading to transparency of taxes paid to the final consumer. Due to efficiency gains and prevention of leakages, the overall tax burden on most commodities will come down, which will benefit consumers. GST in India is similar to VAT in UAE which was supposed to be implemented on April 1, 2017 which has been postponed by two months is now planning to implement from July 1, 2017.