The Goods and Service Tax (GST) Bill was finally passed in the Rajya Sabha on Wednesday. The Bill was already passed by the Lok Sabha.
GST is one indirect tax applicable to the whole nation, which will make India one unified common market.
GST will be a single tax on the supply of goods and services, right from the manufacturer to the consumer. What this means that a customer has to bear only the GST charged by the last dealer in the supply chain, not at every stage.
Here are 5 reasons how business and industry will benefit from GST bill:
All tax payer services such as registrations, returns, payments, etc., would be available to the taxpayers online, which would make compliance easy and transparent.
Uniformity of tax rates
GST will ensure that indirect tax rates and structures are common across the country, which will increase certainty and ease of doing business.
GST would make doing business in the country tax neutral, irrespective of the choice of place of doing business.
Removal of cascading
A system of seamless tax-credits throughout the value-chain, and across boundaries of States, would ensure that there is minimal cascading of taxes. This would reduce hidden costs of doing business.
Reduction in transaction costs of doing business would eventually lead to an improved competitiveness for trade and industry.
Benefit to manufacturers and exporters
The subsuming of major Central and State taxes in GST, complete and comprehensive set-off of input goods and services and phasing out of Central Sales Tax (CST) would reduce the cost of locally manufactured goods and services.
GST will increase the competitiveness of Indian goods and services in the international market and give boost to Indian exports.
The uniformity in tax rates and procedures across the country will also go a long way in reducing the compliance cost.