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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.
