GST positive for India’s credit profile:

GST positive for India’s credit profile:

Context

• Lot of discussion is going around the launch of GST and its corresponding impact on various sectors.
• It is being identified that the new tax regime- GST will have positive impact on India’s credit profile.

Why?

• The Goods and Services Tax (GST) regime will be positive for India’s credit profile as it will contribute to productivity gains and higher GDP growth
• It will also support higher government revenue generation through improved tax compliance
• The Indian industry is prepared for the rollout of the GST
• The regime will contribute to ease of doing business and accelerate new business ventures.

How?

• Over the medium term, we expect that the GST will contribute to productivity gains and higher GDP growth
• GST will improve the ease of doing business, unifying the national market and enhancing India’s attractiveness as a foreign investment destination.
• It will improve tax compliance and administration driven by:
• incentivisation of tax credits in a GST system
• greater ease of compliance through usage of a common, shared IT infrastructure between the central government and the states; and
• a reduction in the overall cost of compliance from simplified tax rates, uniform across the country
• GST comes with the assurance that the Government will continue to facilitate investments and simplify the business environment
• Confederation of Indian Industry (CII) and Indian industry are committed to work in coordination so as to ensure the success of GST for boosting India’s growth and development.