GST is the most discussed subject in current context I have found that this taxation is a complete blunder as per the opinion of political parties in opposition and a boon for everyone else. Narendra Modi Government, world bank, IMF, foreign investors, small and medium businessmen most of them are favoring GST. It is a matter of surprise that when everyone is favoring and praising GST our political parties who are in opposition are contradicting everyone’s viewpoint and opposing it out-and-out.
Looking at their comments and discussions it seems that as if GST is a blunder. Out of curiosity I also discussed about GST with many of my known people and finally found two people who were against GST one friend is working with a bank, I asked him the reason and he could not come up with any satisfactory reply. Second one was a grocery shop owner, he was opposing GST with all bit-and-might, I asked him that all goods you get are GST paid and whatever you sell you just pay the taxation on difference of your cost and selling price this is the same you were doing earlier with VAT so how does it make any difference in your life, and obviously again no valid reason could be found.
The only thing that influenced both of them to be against GST was the negative propaganda of opposition. They must be listening to Rahul Gandhi which created a notion in their brain that something is wrong with GST.
Why is Rahul Gandhi against GST?
Rahul Gandhi calls it as GST ‘Gabbar Singh Tax” but till date he could not give any valid reason which can convince anyone on the real ground of his disagreement. He has only one reason to oppose, and the reason is that he wants to oppose NDA Government. It really doesn’t matter to him whether the policies of Govt. are good or bad he has to oppose everything. He opposed Demonetization, he opposed budget, he opposed foreign tours of our prime minister which brought in strategic gains on global front, so he is not concerned about viability of his comments he only feels that he can do some good to his party by opposing Narendra Modi Government.
World Bank President ‘Jim Yong Kim’ stated that the “Goods and Services Tax (GST) is going to have a hugely positive impact on the Indian economy. Not only this, India jumped up 30 notches into the top 100 rankings on the World Bank’s ‘ease of doing business index” which means it has become easier to start and run a business in India.
This is a clear win for India as it will support FDI inflow which will benefit common citizenry by increasing employment opportunities. World Bank is an international organization created by shared ownership of 189 member countries and India is one of the members.
Shree Rahul Gandhi has posted a remark on Twitter, suggesting that India’s 30-spot jump in “ease of doing business Index” does not represent reality and also that India Doesn’t Need Certificate from World Bank. These imprudent and injudicious comments by Vice president of “Indian national congress” are infelicitous remarks, which show lack of factor of responsibility. A person representing the oldest political party currently in opposition, talks in such a manner which can potentially scale back our global image, then we cannot hold back from calling him jinx of India.
Let opposition speak in their opposing pitch but for common citizenry I am answering some common questions that can be there in the mind of common citizens regarding GST.
Why introducing GST was so Important?
The purpose of introducing GST (Goods and Services Tax) was to make Indian Indirect tax structure more simple and uniform. The indirect tax structure of India was full of annoyance due to multiple rates in different states, such as, at state level VAT (Value Added Tax), at central Govt. CST (Central Sales Tax), CD (Custom Duty), ED (Excise Duty) , some states had entry tax, others had octroi and few more taxes on goods and services in different states, each tax had different rates, calculation method and legal procedures of forms and filing the tax return.
If a company was selling their products all over India it was supposed to pay different tax at every state and stage, also had understand the tax procedures, rules regulations of every state. If the same company wants to keep same MRP all over India then it will be making more profits per unit sale in one state and on the other hand may be incurring loss or very low profit margins in others. So the basic Idea of GST is converting India into a single market. GST is a value added tax which is levied on both goods and services, and which replaced all other indirect taxes.
What are the benefits of GST for a common Citizen?
- Employment Generation – GST will boost FDI and also motivate internal investors to invest in business, because of hassle free tax structure all over India.he mix of Home investment and FDI will boost economy and generate employment opportunities.
- Increase in GDP As demand will grow naturally production has to grow and hence it will increase GDP in near future. The growth will now be fundamental and more sustainable.
- Reduction in Tax Evasion and Gray markets GST is a single tax which will include various taxes, making the system efficient, transparent and with very little chances of Tax Evasion and corruption.
- More Competitive Product As all states have same MRP and there is no confusion on tax structure so it will be easy to analyse the profitability per product all over India which will boost production and due to increase in production there will be more competitive and cost effective products for Indian consumers. Scale of production will also play a role in making Indian products globally competitive.
- Increase in Revenue GST replaced all 17 indirect taxes with single tax. Increase in product demand and number of tax payers will ultimately increase tax revenue for state and central government.
- Easier Policy Making As GST is same in all states it is easier for Govt to understand how to support any particular Industry, product or service, no matter where it is located in India.
What are the issues in GST?
- GST Does not reduce Indirect tax Burdon: GST should not be considered as tax relief, although Govt. has recently given tax relief on many goods and services but objective of GST is to provide a uniform taxation system. Because of GST number of tax payers will increase and as a result there is a possibility of tax relief in future.
- Gray Market: There was a parallel market especially in sectors like electronics, Garments, clothing, commodity and metal etc. but these markets also pose to be an improper competition to genuine tax payers, so loss of few will be benefit for many.
- Teething Problems: This is a genuine issue and every new system will have this kind of issue, server problems in website, hitch on online filing etc fall in the same category. But these are initial hiccups and will fade by time.
How the political parties against GST are taking advantage?
If there is no genuine issue in GST then the point comes that why is the opposition shouting so loud against GST? I found some reasons behind that
- Show Sympathy to tax evaders: It’s true that tax evaders and traders dealing in gray market will be badly hit because of GST, but that will also promote business of genuine tax payers and will also open up opportunities of employment. Now these tax evading traders will defiantly speak against the GST and opposition wants to win sympathy card from them.
- Utilize Teething Problems: Whenever there will be any new structure or reform no matter how well planned it is there will be some initial issues with system and processes. Now opposition wants to confuse people on these initial hiccups and utilize the opportunity to make some people against the system and generate few voters for them.
Although there can be some teething issues with GST which are temporary in nature, but GST (Goods and Services Tax) is implemented in overall interest of the country and its citizens. Passing out from the initial hiccups it will benefit our economy in long run. The politicians who are opposing GST and other appriciable policies of Govt. will find it difficult to dupe people in future and they are actually ruining their own left over space in Indian politics. Indian society is very progressive now and the future lies with those politicians who are willing to take the nation steps forward towards becoming a developed and mature economy of the world.
