International Trade and Goods and Services Tax: A Global Assessment

Abstract

The paper under review highlights the concept of GST(Goods & Services) Tax, its origin and background from international perspective. The research paper focuses on the significance of GST, its impact on various economies i.e. developed, developing, underdeveloped and undeveloped economies. It dwells into the aspects of impact on purchase of goods under GST, procurement of services, road map and challenges of GST on various economies mentioned above, GST and its operations, behaviour of economies on implementation of GST and linkages arising out of the implementation of GST in these economies. So far as the global economic scenario is concerned, this paper studies the impact and assessment of implementation of GST, challenges and their future consequences and course of action to be taken by certain economies after the implementation of GST. These group of economies are OECD countries, Asian, African and Latin American countries. It is observed that the GST rates vary widely among economies. This is evident from the statistical tools that have been used to calculate the median and modal value of GST rates and the coefficient of variations of the GST rates of various economies. Due to the large variations in the median and modal values of GST rates including the coefficient of variation of the GST rates of these economies, the terms of trade between these countries gets affected to a great extent, thereby affecting international trade among these economies. Certain standard models on GST have also been discussed in the paper. Globally, it is seen that 160 countries have adopted GST in one way or the other. This research paper highlights certain key advantages of implementation of GST by the various economies and they include welfare effects, distributional effects, trade effects and macroeconomic effects.