At stroke of midnight, India gets a ‘good and simple tax’

At stroke of midnight, India gets a ‘good and simple tax’

Context:

• India’s biggest tax reform since Independence, rolled out on 1st July, 2017.
• The new good and simple GST (Good and Service Tax) ushers in a ray of hope for the economic pillars of the country.

Significance:

• To serve the purpose of national integration, GST today will help integrate India’s economy.
• The introduction of GST is not only a tax or economic reform but also a social reform that will nudge people on the path to honesty and benefit the poor the most.
• The practice of giving out informal bills would come to an end as the GST presented an opportunity to stop black money and corruption.
• The new GST will open up  chance for the common mass to do honest business.
• The initiative would end the spectre of tax terrorism and Inspector Raj that India’s businesses have had to endure for long.

Conclusion:

• Initially, even though a number of shortcomings may emerge but it is similar to the introduction of the VAT (value-added tax) regime which met resistance initially.
• The GST Council, Centre and States should continuously improve and refine the GST in the same spirit that the country has seen till now.