Rajya Sabha made a historical development by paving the way for the goods and service tax bill. The said bill is expected to trigger GDP bump by a percent and even more.
Let’s see what all specific areas will this bill benefit and how.
1. Boost in Revenue, suppliers will pay tax thanks to tax credit. Also, decline in tax exempt goods will give a push to earnings.
2. Replace Many with One; GST will replace seventeen indirect taxes.
3. Fall in Cost of Capital Goods, full income tax credit (under GST) will reduce cost of capital goods by 12 to 14%.
4. Increased Protection from Imports, this new bill provide suitable countervailing duty.
5. Inventory cost will decline.
6. Creation of a Common Market, absence of which increases the cost by 20-30%.
7. Cheaper Manufacturing Goods, thanks to lower tax and logistic costs.
8. Development of All, with no 2% inter-state levy, new opportunists will be created for smaller states.
9. E- Commerce Wings will Spread, GST will put an end to many levies and state restrictions.
10. GPD Rise, thanks to elimination of tax cascading 80 basis point rise is expected in next 3 to 5 years.
