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Goods and Services Tax: Boosting Domestic Corporate Competition

India's Revenue Secretary Hasmukh Adhia expressed confidence in a smooth transition to the Goods and Services Tax (GST) regime, attributing it to the country's multi-point taxation system, which should prevent sudden inflation. He also noted that GST is anticipated to enhance the competitiveness of domestic businesses by establishing an equitable playing field. The new tax structure is expected to particularly benefit local manufacturers by providing a significant boost.

📖 1 min read read🏷️ GST Impact

Goods and Services Tax: Boosting Domestic Corporate Competition

Revenue Secretary Hasmukh Adhia conveyed confidence that India's move to the new Goods and Services Tax (GST) system would be less disruptive than in other nations. He attributed this smoother transition to India's existing multi-point taxation framework, which helps mitigate rapid inflationary pressures. During a conference in Gujarat, Mr. Adhia also shared his perspective on how GST could enhance the competitive standing of local businesses.

The implementation of GST is expected to foster a more equitable business environment for all enterprises, consequently providing a significant advantage to domestic manufacturers.

As reported in MoneyControl.

Further Reading

Frequently Asked Questions

What is the primary objective of implementing GST in India?
The primary objective of implementing GST in India is to streamline the indirect tax system, eliminate the cascading effect of taxes, and create a unified national market for goods and services.
How does GST simplify the indirect tax structure in India?
GST simplifies the indirect tax structure by subsuming multiple central and state taxes like excise duty, VAT, service tax, etc., into a single, comprehensive tax, making tax compliance easier.
What are the different components of GST in India?
In India, GST comprises three main components: Central GST (CGST) levied by the Centre, State GST (SGST) levied by states, and Integrated GST (IGST) for inter-state transactions, collected by the Centre.
How does Input Tax Credit (ITC) function under the GST regime?
Input Tax Credit (ITC) allows businesses to claim credit for the GST paid on purchases of goods and services used for business operations, which can then be offset against their GST liability on sales.
What are the benefits of GST for Indian businesses?
GST offers several benefits for Indian businesses, including reduced compliance burden, enhanced competitiveness through a seamless credit chain, simplified taxation, and improved logistics efficiency.