The Impact of GST (Goods And Services Tax) in India
The Goods and Services Tax (GST) is one of the biggest economic and taxation reforms undertaken in India. The GST aims to streamline the taxation structure in the country and replace a gamut of indirect taxes with a singular GST to simplify the taxation procedure. The system will phase out all indirect taxes and only GST will be applied as an indirect tax. It will apply on both Goods and Services. Taxes like excise duty, VAT, service tax, luxury tax etc will go with GST’s implementation. GST is essentially a consumption tax and is levied at the final consumption point. The principle used in GST taxation is Destination Principle. It is levied on the value addition and provides set offs. As a result, it avoids the cascading effect or tax on tax which increases the tax burden on the end consumer. It is collected on goods and services at each point of sale in the supply line. The GST that a merchant pays to procure goods or services can be set off later against the tax applicable on supply of goods and services. This paper is an analysis of what the impact of GST (Goods and Services Tax) will be on Indian Tax Scenario.
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