Page 1 of 7
Journal for Studies in Management and Planning
Available at
http://edupediapublications.org/journals/index.php/JSMaP/
ISSN: 2395-0463
Volume 03 Issue 08
July 2017
Available online: http://edupediapublications.org/journals/index.php/JSMaP/ P a g e | 195
Goods and Services Tax (Gst) - Biggest Taxation Reform In India
Radha Yadav
M.com( Delhi University), NET, Assistant Professor Department of Commerce,
Lingaya’s Lalita Devi Institute of Management and Sciences, GGSIPU, New Delhi
Abstract
Goods and Services Tax (GST) is the biggest taxation reform since 1947. It is
implemented in India from 1st July 1, 2017. The main purpose of GST is to sum up
various types of indirect tax all together. This tax structure is designed to support
and enhance the economic growth of the country. This is user friendly and would
bring transparency in the taxation system of India. GST will be levied on
manufacturer sale and consumption of goods and services. It is to overcome all
the shortcomings of the existing taxation system. The paper is focused on
meaning, concept and purpose of GST, all the changes amended by the
government in the tax rates on goods and services and challenges faced by the
stakeholders.
Keywords : GST, Indirect Tax, VAT, Indian economy
Objectives of the study
To study the concept of GST
To know the changes in the
Taxation Structure
To know the benefits and
challenges faced by the
stakeholders.
Research methodology
This paper is based on secondary
data. The data was collected from the
various published sources like
reports, magazines, journals,
newspapers etc.
Concept of GST
The new indirect taxation system that
is Goods and Services Tax (GST) is
made to create a single tax system
and single market. It will boost
economic and development goals.
This system is amended in India from
1
st July 2017; it will throw up some
surprises for consumers and
businesses. First time the consumers
get a measure of the total central and
state taxes levied on a product. It will
end the hidden taxes paid by them.
Page 2 of 7
Journal for Studies in Management and Planning
Available at
http://edupediapublications.org/journals/index.php/JSMaP/
ISSN: 2395-0463
Volume 03 Issue 08
July 2017
Available online: http://edupediapublications.org/journals/index.php/JSMaP/ P a g e | 196
People are concern about inflation.
They expected to rise in price
because of GST. But the government
keen to ensure that GST is not
inflationary, it’s to prevent firms from
passing on any reduction in tax
burden to consumers. Consumers are
likely to benefit from lower tax
burden on some products and
services. Lower indirect taxes will also
address the regressive nature of this
levy which affects the rich and poor
alike, unlike taxes on income which is
based on an assessee’s ability to pay.
For businesses elimination of multiple
levies and creation of a single market
with fever tax rates and fewer tax
exemptions will improve the ease of
doing business and reduce avoidable
litigation. A large part of the tax
litigation in India is around tax
exemption.
Meaning of GST: Goods and Services
Tax is to eliminate inefficiencies in
the tax system that results in “tax on
tax. It is value added tax at each stage
of the supply of goods and services
precisely on the amount of value
addition achieved. It is the tax based
on consumption. It has three
components CGST, SGST and IGST.
GST is the sum of: Import duty,
service tax, excise duty, customs
duty, central sales tax, taxes on
advertisement, luxury tax,
entertainment tax, taxes on betting
and gambling, state cesses and
surcharges on supply of goods and
services.
Other counties GST
Country Rate of GST
Australia 10%
France 19.6%
Canada 5%
Germany 19%
Japan 5%
Singapore 7%
Sweden 25%
New Zealand 15%
There are 150 countries all over the
world there is GST. In India GST rates
are 5%, 12%, 18% and 28%.
Zero rated items: Food grains
used by common people
Page 3 of 7
Journal for Studies in Management and Planning
Available at
http://edupediapublications.org/journals/index.php/JSMaP/
ISSN: 2395-0463
Volume 03 Issue 08
July 2017
Available online: http://edupediapublications.org/journals/index.php/JSMaP/ P a g e | 197
5% rate: items of mass
consumption including
essential commodities will
have low tax incidence.
12% and 18%: Two standard
rates have been finalized as
12% and 18%.
28% rate: White goods were
taxed at 30-31% shall be now
taxed at 28%.
Products not part of GST
Education, health, local train, hotel
up to 1000, Crude oil, petrol, diesel,
natural gas, liquor, jet fuel, meat
other than frozen and in unit
container, fish fresh or chilled, dairy
products, eggs, salt, human blood
and components, contraceptives,
fresh fruits and vegetables, non
branded cereals and flour, jiggery,
non branded organic manure, judicial
non judicial stamp paper, inland, post
cards, non precious metal bangles
and agricultural hand tools,
Impact of GST
Product Current Rates GST Rates
Butter 5.66 12
Television 24.39 28
Footwear 14.41 18
Biscuits 16.09 18
Cornflakes 9.86 18
Wrist watch 20.64 28
Jam 5.66 18
Baby food 7.06 18
Small cars 26 28
Gold 2 3
Insurance 15 18
Banking charges 15 18
Telecom bills 15 18
Movie tickets 40 28
Medicines 5 12,18
Cab rides 6 5
Coal 11.69 5
Maintenance charges 15.55 18
