The First Country in the world to implement the GST Law was France (in 1954). More than 160 countries have implemented this GST system. Following are the great benefits of GST in India.
Consumer Side Benefits:
- Uniform prices for goods and services throughout India.
- GST definitely reduces the tax burden of Indian citizens by removing some of the indirect taxes collected by the Center and the State, because the cost of most goods and services in India is currently loaded with a lot of hidden taxes.
- This means that consumers will now only bear the GST charged at the previous point of the supply chain and not from the manufacturing stage. This reduces the tax burden for end consumers.
- The final cost of goods is expected to be lower because of the smooth flow of tax credit input between producers, retailers and service suppliers.
- The overall tax for some commodities and services will decrease. This will benefit more consumers.
Benefits for the Central Government and State:
- GST replaces some indirect taxes at the Central and State levels, which leads to the administration of the tax system Simple and easy across India.
- GST will also make Indian products competitive in the domestic and international markets, which benefit greatly from the Central and State Governments. GST will have an impact that drives India’s economic growth.
- Increase the overall investment climate in India which will naturally benefit development in the Indian state.
Benefits for Business and Industry:
- Free Flow of Goods and Services – No Checkpoint.
- Tax diversity reduction: – There will be a public market without CST (Central Sales Tax – indirect taxes imposed only on goods sold from one country to another) and entry tax.
- A simpler invoice: – At present, invoices are more detailed because the goods and services tax are written separately for one transaction. With GST implementation, only one level will be written.
- GST replaces the entrance tax: – Elimination of entry tax is a big advantage for the movement of goods through land transportation.
- With the implementation of GST, zero rating is more comprehensive.
- Company with turnover Rs. 20 lakhs (Rs. 10 lakh for special categories) are excluded each year from GST.
- More efficient tax determination, especially for exports.