Photo: Jitender Gupta
One Nation
One Tax
the collection of taxes only, which
was `7.41 lakh crore between August
2017 and March 2018 or more than
`1 lakh crore collections in April
2018 alone. Rather, it is about setting
up a massive process and systems
in place that has brought sweeping
changes in the budget of the
individual, family and institutions.
To begin with, GST had 17 years
of gestation, during which successive
governments had an opportunity to
educate and prepare the stakeholders
for a smooth transition from a
multiple tax structure to an indirect
tax regime on July 1, 2017. Yet, the
government seems to have fallen
behind in its successful execution.
From day one, there has
been massive confusion and
apprehensions over how GST
will work, some of which prevails
till date. The government has
categorised GST in five major slabs –
0, 5, 12, 18 and 28 per cent.
Globally, some 49 countries have
introduced a single GST rate and 28
others use two rates. India is among
five countries that have four rates.
In the last one year, there have been
more than 300 clarifications on tax
and other logistic issues of GST
filing and refund till June 2018.
Prof Arun Kumar, economist
at the Institute of Social Sciences
says, for a complex country like
India, GST is a complex tax, unlike
the general perception of it being
a single and simple tax. Prices of
many products and services have
gone up post GST. It is against the
stated objective of the government
that there will be fall in prices
after its implementation. GST has
impacted nearly all sectors and
individuals - from banking, real
estate, housing, insurance, services,
groceries, toiletries, transport,
hairstyling to even packaged
drinking water. “In the last 12
months, GST has been in turmoil
and it will continue to be so because
of the defective design. GST in
India is a half-way house with many
exemptions,” says Kumar.
Mamta Rajput, an assistant
professor at Delhi University, is
upset. Her monthly expenses have
risen after GST. Her apprehension
about GST is due to lack of clarity
on what is the correct price of the
goods she buys. “For at least three
months, my vegetable hawker and
grocery store vendor hiked prices
because of GST. At stores, prices
marked on the packaged items did
not have GST rates, while there
was no way to check if the prices of
vegetables and groceries have risen
after GST,” she says.
Homebuyers, on the other hand,
are naturally upset over the increase
in cost of housing because of impact
of GST. “With such property prices,
I had to drop plans to buy a house,”
says a Delhi-based entrepreneur.
Developers are not happy either.
GST Benefits Not
Reaching Majority
In the last 1 year, assuming similer
monthly purchases, has your
monthly household grocery bill
reduced due to GST?
63 %
16 %
21 %
Votes
8,118
Assuming similer consumption
pattern, have costs of eating out at
a restaurant reduced for you post
GST?
57 %
28 %
15 %
Votes
8,154
Are businesses passing the benefit
of Input Tax Credit to you via lower
prices?
61 %
24 %
15 %
Votes
8,166
According to you, what is the ideal
Tax Rate tier structure for GST in
India?
40 %
19 %
19 %
Votes
22 %
7,817
Yes No
Can’t Say
Single
Rate Two Rate Three Rate Current or
Structure Structure Four Rate
Structure
Source:
www.outlookmoney.com July 2018 Outlook Money
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