HomeGST NewsImprovements Are Required To Make Gst A Success

Improvements Are Required To Make Gst A Success

Improvements are required to make GST a success

GST is Indian tax reform which allowed that the state where the goods or services are consumed will receive the taxes. This is a massive blow on the indirect tax structure which allowed confusion and corruption in the Indian tax structure due to its complex tax structure which levies varied taxes on manufacturing, selling, movement etc. GST has replaced these indirect taxes levied by central and state government for goods and services and has given birth to a common market and reducing cascading effect of tax considerably. But, is it really easy to take such titanic action or is it easy to implement it?

In the Indian economy big business gets the input from the chains of small business

Indian economy is somewhat complex and the large business is heavily dependant on inputs from small business. The confidence of the organized sector manufacturers will relegate and they might hesitate to expand their business if the supply of the input from the small business is not sufficient. There is the possibility of economic hazardous of the traditional small business channels which provided input to big business dries and  this can force the Indian economy to go back to the value-added taxation again.

GST is armed with some features which are not very favorable to the health of small business

There are some features of the GST which might break or disrupt these supply channels by not benefiting the small scale business. Some alterations are introduced and enhancing the turnover limit to Rs 1 crore for the voucher-free composition scheme which has quarterly reporting one of them. The making of quarterly reporting permissible beyond that up to a limit of Rs 1.5 crores, is a good step. But this will help only the retailers who sell to consumers.

The entire reason behind the value-added taxation was to get better the spatial spread of economic activity and this economic development was for the both regionally and across the scale dimension. But the structure of the present GST design is not in very much favor and the solution of this problem is the elimination of the voucher matching for all but integrated GST transactions.

The eradication of intermediate agents in taxation system will certainly help, but small business cannot be overlooked

It is true that after GST implementation, there is less intervention by the intermediate agents. The elimination of these intermediate agents would make doing business in India less burdensome and easy. The elimination of middlemen at each point of levy of taxes would go a long way to improve the system and but we have started to see the effect of GST and India achieved all time good ranks in doing business in India.

Last but not the least measure is that any reform no matter, political or the economical does not work by its own. It is a mere piece of paper if not bringing any visual change on the ground. To harness the fruits of GST government should follow the tight administration while implementing it.

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