What are the benefits of GST

What are the benefits of GST
GST is the new and biggest tax reform in India. It is going to be implemented from 1st July 2017. It will abolish most of the indirect taxes in India and will be replaced by a single tax i.e., GST. It will bring the concept of “ONE TAX-ONE NATION”. 
GST is regarded as a game changer in the industry.GST is going to affect various industries in different ways. Here are some of the benefits of GST.

Benefits of GST: -

1. Single tax system: -

The biggest advantage of GST introduction is reducing the burden of multiple taxes. GST will abolish most of the current indirect taxes. So, there is no need to pay different types of taxes like service tax, sales tax, octroi tax, excise etc.

2. No need to file multiple returns: -

Earlier we need to file separate returns for each type of taxes. With introduction of GST, only one return is enough for all types of taxes. However, one need to file 3 returns every month under GST.

3. Reduction in prices: -

By introduction GST, it is expected that prices will decrease. Since, at present a price of a product consists of many high rate taxes.

4. Ease of business: -

GST brings the concept of ONE NATION-ONE TAX. Earlier if we want to do business in other states, we require to comply with the tax laws and rules of that state. Now with the introduction of GST, business can be done at free flow through out India. This is more beneficial to inter-state businesses.

5. No tax evasion:

Since all the taxes are integrated and made computerized. Tax evasion is very difficult. For example, all the aggregate of monthly returns turnover has to be tallied with annual GST return, which in turn has to be tallied with income tax return of the assessee.

6. More employment:

Due to GST introduction, cost of the products will decrease which in turn increase in demand of product. The increased demand can be met by only increasing the labour power. Thus, GST will also lead to an increase in employment.

7. Removes cascading affect:

GST will be applicable at all stages in the supply chain, i.e., from manufacturing to consumption. It provides benefit of tax credit at every stage. Due to which tax has to be paid on only the margin added at that stage.

8. Increase in GDP: -

Reduction in costs will increase demand of the product resulting in increase in GDP of country. An increase of around 2% GDP is expected dur to GST.

9. Increase revenue: -

GST aims at increasing the tax payer base by bringing SME’s and unorganized sector into its purview. This will increase the revenue of the government. 

Conclusion: -
Every policy decision has its own pros and cons. Experts have also identified some disadvantages due to implementation of GST. But hope that all will be good in long run.

Tax saving for Freelancers, Professionals, Trader and Web based agencies

10 mins of consultation. Place a request.

Some of the featured articles from our knowledge center

Business2 13a51fd54d37dfeead10bd04c34a46671e69097acf6d8002d2665eb06b5cf58f
What is the income tax payable on partnership firm

As per section 4 of partnership act 1932, partnership means the relationship between the person who are agreed to share the profits of business car...

Business3 1835184f1312bba0b871fddd223a24dd62299180ed03a78d9e4098813c851963
What is business income on presumptive basis under section 44ad and 44ada

As per section 44AA income Tax act 1962, every person who is carrying on business or profession is required to maintain books of accounts. However,...

Business1 8b8cee9b60a38e9df92fb5b897e7c09195532b3d70b7ec28803a600cf2ce60cd
What is GST and different types of GST forms

The Prime Minister approved “The constitution amendment bill for Goods and Service Tax”(GST) in the Parliament Session (Rajya Sabha on 3 August 201...