Monday, July 15, 2024
HomeTrendsFM Nirmala Sitharaman Highlights Positive Impact of GST on State Revenues

FM Nirmala Sitharaman Highlights Positive Impact of GST on State Revenues

FM Nirmala Sitharaman Highlights Positive Impact of GST on State Revenues

Finance Minister Nirmala Sitharaman lauded the positive impact of the Goods and Services Tax (GST) on consumers and state revenue. She emphasized that the implementation of GST on July 1, 2017, has successfully reduced taxes for consumers by eliminating the cascading effect of ‘tax-on-tax.’ Additionally, she highlighted that GST has significantly contributed to the increased revenue generation of states.

According to Sitharaman, the GST system has undergone substantial expansion since its inception. Its implementation has not only benefited consumers but also governments at various levels. The finance minister considers the positive outcomes resulting from the GST implementation as a shining example of its effectiveness.

Sitharaman’s remarks shed light on the remarkable success of GST in reducing the tax burden on consumers. The elimination of ‘tax-on-tax‘ has resulted in a more efficient taxation structure. Furthermore, the implementation of GST has proven to be a valuable source of revenue for state governments, showcasing its positive impact on the overall economy.

What is GST & how it has been treating India? Read more here!

Finance Minister Nirmala Sitharaman highlighted the significant improvement in tax rates under the Goods and Services Tax (GST) compared to the previous tax regime. She stated that GST has been instrumental in providing justice to consumers by reducing tax rates.

Before the implementation of GST, India’s indirect tax system was characterized by fragmentation. Each state functioned as a separate market for both industries and consumers. This fragmentation resulted in complex tax structures and varying tax rates across states, making it cumbersome for businesses to operate efficiently and creating challenges for consumers.

With the introduction of GST, the tax system has undergone a significant transformation. GST has unified the country’s indirect tax structure, streamlining it into a single tax regime applicable nationwide. This has eliminated the complexities and inconsistencies associated with the previous system, resulting in a more efficient and harmonized taxation framework.

Moreover, Sitharaman emphasized that GST has brought down tax rates for consumers, ensuring fairness and affordability. The unified tax structure under GST has enabled the reduction of the cascading effect of ‘tax-on-tax,’ ultimately benefiting consumers by lowering the overall tax burden on goods and services.

Country needs a just and balanced Taxation System – Daily The Azb

During GST Day 2023, Finance Minister Nirmala Sitharaman addressed the issue of the “tax-on-tax” effect that existed under the pre-GST regime. She explained that the multiplicity of taxes resulted in a situation where the same product was subjected to multiple layers of taxation, making it more expensive for consumers. However, with the introduction of GST, this cascading effect has been eliminated, leading to a reduction in the actual tax burden on consumers.

Sitharaman emphasized that GST has significantly brought down the tax burden on consumers and, in some cases, to a remarkable extent. Despite this positive reality, she acknowledged that there are still misconceptions about GST burdening society. Sitharaman clarified that such beliefs are unfounded, as the implementation of GST has alleviated the tax burden on consumers.

The Finance Minister’s remarks highlight the positive impact of GST in reducing the tax burden for consumers. By eliminating the “tax-on-tax” effect, GST has ensured that the same product is not subjected to multiple layers of taxation, thereby making it more affordable for consumers. Sitharaman’s statements aim to address any misunderstandings and emphasize the benefits of GST in terms of reducing the tax burden on society.

According to Finance Minister Nirmala Sitharaman, the implementation of GST has ensured that only the right amount of tax owed to the government is collected systematically, eliminating personal discretion. Sitharaman highlighted that GST has simplified processes for small businesses and facilitated the free movement of goods across the country.

Free Movement of Goods in Practice: The Art and Craft of Contract ...

Sitharaman emphasized that GST has benefited various stakeholders, including the common consumer and state governments. She praised GST for its contribution to tax buoyancy, digitalization, and simplification, considering it an exemplary system.

To support her statements, Sitharaman provided data indicating the improvement in revenue buoyancy for states after the rollout of GST. In the pre-GST era, the tax revenue growth of states stood at 8.3 percent, while GDP growth was 11.5 percent, resulting in a tax buoyancy of 0.72. This indicates that the growth of states’ tax revenues lagged behind the pace of GDP growth.

She emphasized that the implementation of GST has brought relief to the common man by avoiding double taxation and reducing tax rates. She commended the dedication of tax officers, whose efforts have contributed to making monthly GST revenues of over Rs 1.60 lakh crore the “new normal.” The growth of 12 percent in GST collection in June further showcases the effectiveness of GST in increasing revenue and benefiting the economy. This highlights the key benefits of GST, including the elimination of double taxation and the reduction of tax rates, resulting in relief for the common man. She also acknowledged the efforts of tax officers in ensuring efficient and consistent GST revenue collection.

Sitharaman’s remarks highlight the positive impact of GST in ensuring fair and systematic tax collection, simplifying processes for small businesses, and promoting the free movement of goods within the country. The data presented demonstrates the improvement in revenue buoyancy for states following the implementation of GST, reflecting its positive effects on the overall economy.

RELATED ARTICLES

LEAVE A REPLY

Please enter your comment!
Please enter your name here
Captcha verification failed!
CAPTCHA user score failed. Please contact us!

- Advertisment -

Most Popular

Recent Comments