Goods And Services Tax Research Articles

Restoring Digitization for Sustainable Banking-Business in India

Recent initiatives of demonetisation and goods and service tax (GST) in India have promulgated more transactions via formal banking channel through digital mode making India a sustainable, less-cash economy. But current penetration of digital banking is in India is only 18% (Mckinsey Asia Financial Survey). Hence this research paper has a purpose to understand the root causes and customer's hitches for digital banking and to suggest a model to increase the penetration of digital banking in India. A survey of 690 banking customers is done to understand customer's interest for digital banking. Out of the six identified hitches for digital banking it is found that 'hitches of identity theft while using NET banking' and 'hitches due to misuse of confidential information by companies' are the most significant predictors to estimate the customer's interest for using digital banking. Customer's interest for digital banking varies significantly with age.

Goods and Service Tax(GST) on the Retailers with Special Reference to Kerala

Goods and Service Tax(GST) on the Retailers with Special Reference to Kerala

Diagnosing the VAT Compliance Burden: A Cross-Country Assessment

This report sets out the findings of an extended study designed to test a diagnostic tool that has been developed for use in comparative cross-country assessments of the VAT compliance burden and its main drivers. It is based on data gathered from surveys conducted in the 47 member countries of the Forum on Tax Administration (FTA) that administer a Value Added Tax (VAT) or Goods and Services Tax (GST) regime.

The Effect of Tax Reforms on Tax Agents’ Job Burnout in Malaysia

Goods and Services Tax (GST) is part of the Government's tax reform programmed to enhance the efficiency and effectiveness of the taxation system. Tax agents play a vital role in enhancing GST compliance since they act as the intermediary between businesses and the government. Therefore, it is vital for tax agents to conduct their functions effectively in order to ensure the smooth implementation of GST. In doing so, tax agents may face certain difficulties which may cause high degree of job burnout among them. The main research objective of the study is to examine the relationship between the areas of difficulties faced by tax agents during GST implementation and tax agents’ job burnout. There are four areas of difficulties identified which are difficulties regarding GST knowledge, GST tax treatments, GST administration, and GST compliance costs. Result from the Pearson’s Product-Moment Correlation Analysis identified negative association between the independent variables and the dependent variable. This shows tax agents facing difficulties will tend to experience job burnout frequently. Then, based on the results of Multiple Regression Analysis, only hypothesis H1 and H2 are supported in this study i.e. difficulties regarding GST knowledge and GST tax treatments faced by tax agents will significantly affect the level of tax agents’ job burnout. Tax agents always the front liner to businesses in providing GST support, such as advice the business on procedures and the significance of the new tax system. Hence, in spite of GST complexity, tax agents need to understand the system and its tax treatments thoroughly. As a consequence, it lead to the increment of job burnout among tax agents.

The Effect of Government Support Programs and Compliance Costs on Goods and Services Tax Compliance among Malaysian Batik Manufacturers

The Goods and Services Tax (GST) implementation in Malaysia has received mixed reactions from various parties such as businesses, policy makers, professionals, business associations and individuals. Despite the rejections from these parties, the government proceeded with implementing GST. On consequence, this has led to GST compliance issues. One of the issues that have been highlighted is high compliance cost. To address this issue, various Government Support Programs (GSPs) have been implemented in Malaysia particularly financial and credit assistance. Therefore, this study aims to determine the effect of GSPs on GST compliance among batik manufacturers in Malaysia. In addition, this study also examines the relationship between compliance cost in terms of fiscal cost, time cost and psychological costs on GST compliance among Malaysian batik manufacturers. Data was collected through a structured survey among Malaysian batik manufacturers. Based on the finding, the result showed that GSPs, time cost and psychological cost do affect GST compliance while fiscal cost did not affect GST compliance among batik manufacturer. The findings in this study provide awareness to the government on the need of more GSPs and other incentives to the batik manufacturers in order to encourage them to comply with GST.

A Critical Appraisal of Goods and Services Tax in India

The present paper attempts to make a critical appraisal of Goods and Services Tax (GST), implemented in India from 1st July, 2017. In addition to explaining the structure of GST in India as well as the tax rates under it, the present paper attempts to analyse the impact of GST on certain major industries or sectors within the Indian economy. Although GST has certain obvious advantages including exemptions and low compliance burden for small businesses, lower tax rates for mass consumption goods, increase in tax base and tax collections, etc., it is noteworthy, however, that GST has certain limitations as well. In spite of this, it must be accepted that GST has helped in ensuring a common Indian market through the elimination of multiplicity of taxes as well as ‘ tax on tax ‘. It is expected to accelerate economic growth, help generate more of employment opportunities, and lead to increased tax base as well as increased revenue generation

Malaysian 14th General Election: Young Voters & Rising Political Participation

The 14th General Election (GE14) was the most exciting general election ever had by Malaysian’s ever since its independence in 1957. The high participation of young voters or better known as the ‘Kingmaker’ which made up 41% of the total voters was the main reason for the topple of Barisan Nasional (BN) government that have administrated the nation for the last 60 years. Given the influence of awareness towards electoral issues and the political knowledge, this paper aims to understand the young voters’ participation during election. Guided by Michael Foucault ‘Theory of Power’, this paper examines how voters rely on technology to educate themselves on the election issues that become a concern for them before exercising their power by determining and selecting their preferred government. The findings of the data were collected through focus group discussions, involving twelve (12) participants which consist of Malay, Chinese and Indian voters, aged between 21-39 years old. From the findings, issues relating to 1 Malaysia Development Berhad (1MDB), Goods and Service Tax (GST), high cost of living, and PTPTN have grabbed their attention. Their concern towards these issues were caused by the economy impact that it has on their daily lives. Influenced by their heavy reliance on social media as a source of information which was easily accessible through smart phones further motivates them to cast their votes despite of their depth of knowledge on electoral processes. Nevertheless, both Government and the Election Commission have a vital role to play in drawing young voters’ attention whilst engaging and educating them for the next General Election.

An Assessment of Impact of GST on India’s Online Retail Sector

The online retail market in India is relatively new and still adapting to the global business environment. Also, conventional tax regime was neither able to cover all e-commerce transactions nor give it a proper space to flourish. The launch of Goods and Services Tax (GST) changed the taxation scenario in India from a very complex tax structure comprising of around 500 different kinds of taxes to a simpler tax regime with just 3 broad tax categories while having both positive and negative impacts on industries operating in organized and unorganized manner. The objective of this exploratory, qualitative, and non-empirical paper is to explore and present the consequences of the introduction of GST on the Indian Economy with special reference to the online retail industry in India. Researchers reviewed the reports of various departments of Government of India (such as the Central Board of Excise and Customs); the GST Council reports up to 30th meeting held on September 28th 2018; Honorable Finance Minister’s speech on GST; and interviews of government officials. This paper may provide useful insights to the online retailers, suppliers and most importantly, the common buyers in understanding the changes brought by GST and help the GST Council in making further amendments in the Act.

Implications of Goods and Services Tax reform on the Make in India initiative: A system dynamics perspective

AbstractThe paper highlights the implications of Goods and Services Tax (GST), a major tax reform in India launched in July 2017 on the Make in India initiative launched in the year 2014. The GST is expected to trigger its impact on the following eight elements: warehouse efficiency, interstate check‐post operations, informal to formal business transition, interstate business expansion by micro, small, and medium enterprises, simplicity and transparency in tax collection process, logistics cost reductions, ease of doing business in India, and working capital cost realignment, which in turn may accelerate the manufacturing growth in Indian economy. In order to study the impact of the factors of GST on the Make in India initiative and the manufacturing growth, a system dynamics approach has been adopted in this paper. A number of simulation runs carried out using the system dynamics modelling have provided meaningful insights to the policymakers and strategic planners for evolving strategies for manufacturing growth.

The Elements of Conceptual Model Goods and Services Tax Registered Persons in Malaysia

Goods and Services Tax (GST) system was implemented on the 1st April 2015 in Malaysia. Like many others tax administration, tax compliance has been a major concern to the Royal Malaysia Customs Department (RMCD) (Zainol et al., 2015). The issue of tax non- compliance such as over claiming of input tax, not issuing tax invoices, and under declaring output tax by the registered persons induced this study. Thus, this study seeks to establish the determinant factors that may influence the tax compliance behaviour of GST registered person in Malaysia. This study also attempts to propose a conceptual framework GST tax compliance behaviour by integrating economic factors such as tax structure system of GST tax rate, audit, penalty/fine, and psychological and sociological factors like attitude towards GST and GST tax knowledge.

Comment on “Modinomics: Design, Implementation, Outcomes and Prospects”

Comment on “Modinomics: Design, Implementation, Outcomes and Prospects”

Exploring the Challenges of Goods and Services Tax on Batik Manufacturers

The implementation of Goods and Services Tax (GST) in Malaysia has received criticism from various parties such as businesses, policy makers, professionals, business associations and individuals. Despite the rejections from these parties, the government proceeded to implement GST on 1 April 2015. Subsequently, this led to difficulties encountered by businesses, particularly the manufacturing industry in adjusting the production cost, setting prices of products, and comply with the new indirect tax structure. Hence, this study aims to explore the challenges of GST on SME batik manufacturers pertaining to business performance and compliance. A semi structured interviews were conducted on the top management and owners of SME batik manufacturer in two states of Malaysian Peninsular, namely Kelantan and Terengganu. The respondents reported that, during the era of GST, sales of their batik products decreased tremendously. In addition, they described the GST system as a complex system that affects compliance. This study solicits government’s attention on the impact of GST on Malaysian batik manufacturers. The findings suggest that it is essential for government to devise plans in reducing the financial burden of batik manufacturers and to simplify the GST mechanism in encouraging a high level of GST compliance.

Value Co-Creation, Goods and Service Tax (GST) Impacts on Sustainable Logistic Performance

This paper investigates value co-creation and the impact of GST on sustainable logistic performance (SLP). Prior to data collection, metrics were verified utilizing pre-and pilot tests to ensure that measurement items were properly adapted. Then, an e-survey was conducted among Goods and Service Tax (GST) registered logistic service providers (LSPs) in Malaysia using stratified random sampling. A total of 145 LSPs registered under the Malaysian GST scheme participated in the survey. The study found that open dialogue and limited access during value co-creation partially supported SLP. A positive link proved that risk assessment and transparency fully supported SLP. LSPs that have not conquered the nuisances of GST implementation have a reduced ability to compete globally. LSPs are needed to create useful CSR programmes and civilian-led humanitarian operations when a natural disaster occurs. The LSPs that have a high degree of SLP can create more job opportunities for disabled workers, provide a better workplace for women employees and increase employment for ethnic minorities.

THE EFFECTS OF PENALTY INFORMATION ON TAX COMPLIANCE

This paper examines the effects of late payment penalties on tax compliance based on an experiment involving New Zealand goods and service tax (GST) ‘late payers’, using a late payment model in which the probability of enforcement, rather than detection, is central. A field experiment involving a specific compliance intervention, allows us to examine how taxpayers respond when given different penalty information, examining effects on both taxpayers’ stated compliance intentions and subsequently observed behavior. Results suggest that differences in penalty information given to taxpayers and reductions in penalty rates affect compliance stated intentions but actual behavior is generally unresponsive.

Extending the Singapore Goods and Services Tax to Imports of Services

The Singapore Minister for Finance announced in his recent 2018 Budget Statement that the scope of Singapore’s goods and services tax (GST) will be extended to cover imports of services with effect from 1 January 2020. In this article, the author provides an outline and commentary on the proposals arising from the announcement.

Challenges and Opportunities in Implementation of GST Bill for Insurance Sector in India

The Indian economy is witnessing streamlined and focused efforts, of the kind off late for the implementation of the Goods and Service Tax (GST). With the services sector accounting for 60% of the GDP, the impact of GST on the service sector is likely to run deep. GST is undisputedly the single largest indirect tax reform since independence. It has the ability to change India's indirect taxation landscape and resulting in a positive impact on the entire economy. The present study is an attempt to understand the impact of GST on Insurance Industry along with highlighting the basic concept of GST, models of GST and its pros and cons in Indian context. The study also highlights the challenges in implementing the system. The introduction of GST will have a definitive impact on services offered by the life insurance sector. Seeking to levy GST on life insurance services would be in contrast to several countries where life insurance is a social security benefit being provided. Given the strategic importance of life insurance sector and the vast untapped market, it is believed that Government will address the concerns of the industry including ensuring merit rate of GST on insurance sector.

Management Accounting in India

India is undergoing a rapid transformation. Recent events, including its currency demonetization, the rapid rollout of digital banking, and the introduction of a new nationwide goods and service tax (GST), are signs of the dramatic economic, social, and political changes taking place. This transformation will provide significant opportunities — and challenges — for Indian businesses. Management accountants can play a unique role in guiding their organizations in this changing business environment. No longer is their role confined to the accumulation and reporting of financial data. IMA® (Institute of Management Accountants) research has shown that finance and accounting professionals around the world are partnering with others inside their organizations to help formulate, evaluate, and implement their organizations’ strategy.

GST Reform in Australia: Implications of Estimating Price Elasticities of Demand for Food

This paper uses detailed information about household supermarket purchases from the Australian Nielsen Homescan Survey to estimate price elasticities of demand for a range of food categories. An instrumental variable strategy is employed to address endogeneity issues. The estimates obtained from our analysis are used to study five scenarios in which the rate of the goods and services tax (GST) on food categories is increased or in which the tax base is broadened to include currently GST‐free categories. Our findings reveal that there is considerable scope for raising revenue by increasing the rate and broadening the tax base.

A Study on Consumers’ Awareness on Goods and Services Tax

The Goods and Services Tax (GST) -- India's biggest tax reform since independence formally launched in Parliament by Prime Minister Narendra Modi and President Pranab Mukherjee came into force after 17 tumultuous years of debate, unifying more than a dozen central and state levies. The new tax regime was ushered at the late night of 30th June and came into force on 1st July 2017. The one national GST unifies the country's USD 2 trillion economy and 1.3 billion people into a common market. As commented by Mr.Modi, GST is not just tax reform but its economic reform. GST is a way forward in the ease of doing business. In the language of law, it is called the goods and services tax, but the benefit of GST is really a Good and Simple Tax. Good because multiple taxes will be removed. Simple because it requires just one form and is easy to use. GST is a single tax on the supply of goods and services, right from the manufacturer to the consumer. Credits of input taxes paid at each stage will be available in the subsequent stage of value addition, which makes GST essentially a tax only on value addition at each stage. The final consumer will thus bear only the GST charged by the last dealer in the supply chain, with set-off benefits at all the previous stages. It renders numerous benefits to different parties such as business and industry, central and state governments and the ultimate consumers. An effort is made to understand the consumers’ awareness on Goods and Services Tax. Everything that is introduced will attract agitation and unrest among different group of people and they can easily be overcome by designing programmes to clarify the objections of renowned economists. GST will sure to have success when the confidence of every individual Indian citizens have obtained.

Public Acceptance on GST and Quality of Life

In Malaysia, the goods and services tax (GST) was implemented in 2015 as part of a tax reform program to generate a stable source of revenue. This study explores human behaviour towards GST, a week post-implementation. The partial least square (PLS) modelling was used to establish the relationship between acceptance, knowledge and feelings towards GST as well as the quality of life. There is a positive relationship between the antecedents and the quality of life. Acceptance of GST exerts a significant relationship towards feelings and quality of life in the future.