Goods and services tax law in India is a comprehensive, multi-stage, destination-based tax that is levied on every value addition. In other words, goods and services is an indirect tax levied on the supply of goods and services. The goods and services tax act were passed on 29th March in the parliament. The act came into effect on 1st July 2017. Goods and services are divided into five slabs for the collection of tax- 5%, 12%, 18%, 28%.
Benefits of GST on Indian economy-
Removal of bundled indirect taxes such as VAT, CST, CAD, service tax.
Removal of cascading effect of tax i.e. tax on tax.
Increased demand and consumption of goods
Boost to the Indian economy in the long run.
Impact of GST on Indian economy-
Reduces tax burden on producers and fosters growth through more production.
There will be more transparency in the system as the customers will know how much taxes they are being charged and on what base.
GST will add to the government revenues by extending the tax base.
GST will remove the customs duty applicable to exports. The nation’s competitiveness in a foreign market will increase on account of lower costs of the transaction.
Lower the burden on common man, which will lead to more demand and consumption of goods.
At last, we can conclude that GST will lead to a brighter economy.