One year of GST: Does India’s new Tax reform succeed?

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One year of GST: Does India’s new Tax reform succeed?

one year of GST

Before introduction of GST , Indian taxation system was divided into central, state and local authority. In the previous system, power on taxation of goods was with central government but only up to manufacture and production through the excise duty while states government had power to tax on sale of goods. Central government had service tax under their control, such division of taxing power had created many disputes among central and state taxation authorities.

Goods and Service Tax, a highly controversial tax reform was introduced on July 1, 2017. The motive was to remove double taxation, cascading effect of taxes, multiple taxes and returns, inflation and to introduce one tax with free flow of goods, simple tax return and filing, reduction of tax rate on daily use, household items.

The Finance minister of India, Mr. Arun Jaitley, on the first anniversary of goods and sercie tax, addressed that pre-GST, taxation system in India was very complicated. GST has persuaded people to do business in a transparent and clean manner with no evasion of taxes.

Listing out the remarkable success that GST has achieved in a short span of 1 year, the FM said that new reform has created a unified market, the weighted average of taxation basket has been reduced. The total collection of tax from implementation till march 2018, i.e. for 9 months is stated at Rs 8.2 lakh crores with an average Rs 89,885 crores per month,and if extrapolated for the whole year the total collection comes at about Rs 11 lakh cores , an increase of 11.9% from pre-GST tax collections.

The finance minster also added that the GSTN Council is constantly working on to rationalize tax slabs and stability in the system. The council is working on to new return filing system, to make tax return filing better and simple. The FM thanked all state ministers and officers who gave their support in the implementation of GST.

Still of such a remarkable tax collections and rules introduced, GST didn’t fully succeeded. Many traders found new ways to evade tax, transporters using same e-way bill in multiple movement of goods i.e. using a same e way bill twice and thrice. The gst portal sometime does not work properly, taxpayers and professional faced many problems in return filing due to glitches and crashing of website. The government has to see and make necessary regulations  regarding black practices to evade tax and also to develop a smooth and efficent online system.

Stay updated and tuned with Charteredkid latest news and updates regarding GST.


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