Role of GST in Economic Development

Abstract

The Goods and Services Tax (GST) is the biggest reform in India’s indirect tax structure. GST would be applicable on the supply of goods or services as against the previous concept of tax on the manufacture and sale of goods or provision of services. It is a destination based consumption tax. GST would apply to all goods other than exempted goods i.e. alcoholic liquor for human consumption and specified petroleum products. It would apply to all services barring a few to be specified. The impact of GST would be a major game changer for the economy for accelerating the economic growth and generating more and more employment. GST helps the economy to grow in more efficient manner by ameliorating the tax accumulation as it abolishes all the tax barriers among states and integrate country via single tax rate i.e.”One tax ,one nation”. It benefits the Indian economy in many ways e.g. reducing the price for domestic necessities, uniform tax rate, reduce multiple taxes etc .GST will affect many sectors in positive or negative manner. After GST implementation some products price have been reduced like branded goods, hotels, personal hair products, soap etc. some products price have been increased like mobile bills, aerated drinks, internet, air tickets. This paper focuses on the benefits, challenges and roll of GST on Indian economic development.