How is GST beneficial for the country? How would it help to imporve country’s economy?

How is GST beneficial for the country? How would it help to imporve country's economy?
What is GST?

GST goods and service taxes is a bill recently passed that helps in making your tax structure easier and helps in removing all the extra taxes from a business. GST helps in managing your taxes and gives you a clear view of what you are paying for and what are the taxes that you are paying. It filters all the unnecessary taxes that you pay for without clear knowledge. With GST all the taxes paid remains clear and hence you can enjoy simple tax. It is a consumption based tax that depends on sale, manufacture and consumption on good ans services at a national level. With the increase in Global trade GST has become a complete global standard. It brings out the qualitative change in the tax system by redistributing the burden of taxation equitably between manufacturing and services.
The studies conducted so far shows that the growth of GDP cab be in between 2-2.5% by implying a well designed GST. The increase in exports can be between 10-14% . GST can be a successful program if it is implemented in the same way in all the states and centre which will result in a common market.
It removes all the indirect taxes hence reduce the tax for business and all the processes as we know that tax barriers in the form of CST, entry tax and restricted input tax credit have fragmented the Infdian market for long hence GST had to step in to filter and give abetter shape to our taxation. Introducing GST to the country is beneficial and is going to help the country in several mainly in a way how it is going to help the growth of economy. GST removes al the cascading ffect of taxes imbedded in cost of production of goods and services and provides semless credits thropughout value chain. It reduces the indeginous goods and promotes an idea of better country. Also the GSTNET without any human intervention can reduce corruption and any kind of tax evasion. The built-in check on buisness ytransactions through seamless credit and return processing reduce scope for black money generation leading to more productive use of the capital. GST elimates the double taxation in certain sectors due to tax conflicts on whether a particular indirect taxes or other extra charges.
The indirect tax in the country have driven businesses to change the model of their supply chain and systems owing to multiplicity of taxes and costs involved. The total tax collection in India bot direct and indirect is Rs. 14.6 lakh crors and 34 percent of that comprises indirect taxes with Rs. 2.8 lakh crore coming from excise and Rs. 2.1 lakh crore from the service tax. With implementation of GST the entire indirect tax syetm in India is evoliving for good. The tax reveune will change the face of the country’s economy.

Objectives of GST:

• Making sure of the availability of input credit across the value chain
• Minimising cascading effect of taxation
• Simplification of tax struction
• Bringing harmony in tax base, law and administration procedures across the country
• Minimising tax rate slabs to avoid classification issues
• Removal of unhealthy competition among the states
• Increasing the tax base and raising complaince

What will happen when GST is implemented?

1. GST will reshape the indirect tax structure as it will remove most of the indirect atxes like excise, sales and serivi. It removes the omplicated procedures and structures of the tax and imporves the ease of doing business within the country.
2. It leads to the creation of a a common market which will faciliate seamless movement of the goods across the country. The securitiy checks usually have tolls and has transport tax and opther charges which wil be brought down with the implementation of GST. There are several logistic costs that causes the tax the go up which can be brought down with the help of GST implemetation. m
3. The GST will help the manufacturers to get the credits for all the taxes paid earlier in the goods and service chain. This will incentivise the firms to source inputs from other registered dealers. This will bring aditional revenues for the government as the unorganized sector which is not a part of the value chain.
4. To own the tax credit every dealer gets to request for an incentove from the dealer who stays behind him in the VAT. Thus the new tax regime interfers less and is more self policing hence is more effective in the way of reducing the corruption.
5. The provider because of the paper trail left by the GST gets the clear information about his evasion that will be detected once his client is audited.
6. The finace ministry provided a report that said that the GST regime boost tha ‘make in India’ programme as the manufacturers will get input tax credits for capital goods.
7. the clean up of the Indian taxation system will deduct the number of excise duty exemptions. The government’s estimates. excise tax exemptions result in old revenues of Rs. 1.8 lakh. The comparable figure for the states is about 1.5 lakh crore. Together India loses about 2.7 percent GDP because of exemptions.
8. The service tax of products can rise from the currentr level of 15 percent. The GST tax regime will lead it upto 18 percent but only for atemporary period.
9. GST implementation is expected to lead to temporary rise in inflation for about a year, which will wear off gradually. The GST implementation wll benefit many in number comared to the first year of implementation.
10. The implementation of GST, paints and other construction chemicals ompanis will benefits from lower tax rate.
11. The market share for the organized sector is about 65-75 per cent. Effective tax correction practices under the GST regime will ensure that the price difference amongst the unorganized sector and the organized sector gets narrowed. This will improve opportunities for the organised sector.
12. The overall cost and competitivesness in products such as like ceramic tiles, faucets, sanitary ware and plywood & laminates manufacturer will be curbed.

Benefits of GST implementation in the country:

1. Removal of bundied indirect taxes such as VAT, CST, service tax, CAD, SAD and excise.
2. Less tax compliance and a simplified tax policy compared to current tax structure.
3. Removal of casacading effect of taxes that is that it will remove the tax on tax.
4. reduction of manufcaturing costs due to lower burden of taxes on the facturing sector. Hence prices of consumer goods will be likely to come down.
5. Lower the burden on the common man which means they will have to spend less money to buy the same products that charged more because of the taxes.
6. Increased demand and comsumption of goods.
7. increased demand will lead to increase in supply. Hence this will ultimately lead to rise in the production of goods.
8. Control of black money ciculation by the traders and shopkeepers will be put to a mandatory check.
9. Reduction of the proice gap between the organized sector.
10. The warehouse/logistics costs across the operational and non-operational segements will be curtailed. This will improve the operational profitability by the almost 300-400 bps.
11. The 7th Pay commission is also expected to boost demand and fund inflow in the consumner durables sector by the end of the year.

Better economy with GST implentation

1. Reduces tax burden on the producers and fosters growth through more production. The tax structure without GST is a complicated process and many other difficult bumps which makes the growth of manufacturers stagnant or slow. GST will take care of this maytter by providing tac credit to the manufcaturers.
2. Different tax barrier, such as check posts, toll gates etc, leads to the wastage of unpreserved goods being transported. This penalty trnasforms into a major costs due to higher neds of buffer stock and ware housing costs. GST will bring unioformity to the taxation which will eleimate this issue.
3. There will be more trnaperabncy in the system as the customers will know exactly what they are paying for and how much are they paying for.
4. GST will add to the government revenues by extending the tax base.
5. GST will provide credit for the taxes paid by producers in the goods or services chain. This is expected to encourage producers to buy raw material from different registered dealers and is hoped to bring in more vendors and suppliers under the purview of taxation.
6. GST will remove the custom duties appliacble on exports. The nation’s competitiveness in foreign markets will increse on account of lower costs of transcation.
7. 7. The GST implementation will essentially benefit companies, which have not availed tax exemptions in the past.
Introducing of GST is a right step in field of inderect tax reforms in India. By bringing a large number of central and state taxes into a single tax, GST is expected to significantly ease double taxation and make taxation overall easy for the industries. The most beneficial part will be the reduction of overall tax load on goods and services. GST will also make Indian products competitive in the domestic and international markets. And lastly GST will make the tranport simply easier giving all the import export an extreme easy business. This entire GST implementation has a positive impact and will help in imporvement of the business and Indian economy from all the sides in various ways.

Reach Accounting software (GST Ready)

Reach is one of the most suitable softare for any kind of business. It helps a business in every way posisbel by taking care of it taxes, accounts, inventory, sales, expenses, etc. It is a powerful software that is easy to use and has a simple working process and customizes with every business for better exploitation. It is cloud based and has several products one of which is a GST software.

Benefits of Reach:

1. It easily customizes with any business hence it can be sued by any niche and type of business. This way you can use it to the maximum as it will move according to your business process.
2. Reach is user friendly, thus you can use it easilya nd it will take less time to get implemented and your employees will be bale to use it as soon as possible. Reach has simple steps to begin with which makes it easy to use.
3. It reduces costs in your business as it tracks every expense happening and this way you can keep track of every detail and control your business expenses. It also helps you to keep your budget under watch so you know hwere the money is being spend. Reach helps in reducing the use of paper as the printing will be seldom required.
4. Reach is a completely safe software. It provides bak level security with 256 bit encryption. It also comes with accessibility restriction meny which gives you more privacy. Reach comes with free anti virus making it easy for you to run your business with not virus attack on your data. Your data gets stores in the cloud as it provides auto backup every 3 hours, hence there are no risks of data loss.
5. Reach is easily accessible from anywhere making it possible for you to keep an eye on your business evenw hen you are not at work. This way you can work better and manage better even when you have multi branch or multi company business.
6. With Reach yopu will be able to make more sales and enjoy more profit as it helps in better decision making. It is a smart software that helps you in mking smarter decisions as it keeps a track of all the data and gathers information making everyhting visible to you for a more accurate decision.

Who can use it?

Reach GST software can be sued by any type of business and here is a list below:
1. Consultants and freelancers
2. Packers and movers
3. Rentals and subscription
4. Startups
5. Transporters
6. E-comerce stores
7. Electronics and spare part dealers
8. Importers and exporters
9. Automobile dealer
10. Whole salers and distributors
11. Café &bakery
12. Diamond traders
13. Furniture stores
14. Jewellery store
15. Service centers
16. Textile stores
17. supermarkets
18. takeaways business
19. Workshop management
20. Textile stores
21. Manufacturers
22. Job work and contractors

For 15 days free trial of Reach GST software click on>> demohttp://www.reachaccountant.com/gst-software/

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