Goods & Services Tax (GST) will revolutionise indian economy

Goods & Services Tax will revolutionize indian economy. Recently amendments to the indian Constitution were passed both in the upper house and lower house of the parliament. Now it has to be passed in at least 15 state assemblies and a GST council has to be formed comprising members from both ruling and opposition parties. GST Council will draft the GST Bill. It is expected for GST tax to be implemented by 1st April 2016. The GST rate of tax is likely between 14% to 18%.

GST would bring following benefits to the indian economy:

1. Multiple taxes at multiple rates by different states will be replaced by single GST tax. One nation one tax policy will arrive.
2. Goods will be taxed at the point of consumption instead of goods being taxed multiple times at different rates.
3. Goods would be transported faster across the country. At present indian cargo trucks cover average daily distance of 250 to 300 kms as against 600 kms to 800 kms in developed economies.
4. Both manufacturing and services sector will grow faster.
5. Consumer would have to pay lesser taxes.
6. GST is expected to increase India's GDP by 1.50 % to 2.00%