Asst Prof.

Ameya C Lohar

GDM Arts, KRN Commerce & MD Science College

Jamner Dist – Jalgaon

E-mail – ameya.c.lohar@gmail.com Contact No - 9960336255

AN IMPACT OF GOODS AND SERVICE TAX ON GROSS DOMESTIC

PRODUCT OF INDIA

Abstract

The Good and Services Tax (GST) is the greatest and considerable roundabout duty
change since 1947. The principle thought of GST is to supplant existing duties like value
added tax, excise duty, service tax and sales tax. It will be collected on manufactured sale
and utilization of merchandise and ventures. In excess of 150 nations have executed GST
up until this point. In any case, the possibility of GST in India was mooted by Vajpayee
government in 2000 also; the established correction for the same was done by the
Lokshabha on sixth May 2015. The bill looks to amend the constitution to present GST
vide proposed new article 246A. This article gives control to governing body to each state
and parliament to make laws as for GST where the provisions of products or services
occur. Regardless of the different alterations to the proposed progress, until the time GST
is executed, it would beneficial to survey its positive effect on the different improvement
zones viz. Agribusiness, Forestry, Mining & Quarrying, Manufacturing industry,
Construction, Housing, Trade, Hotel, Transport, Communication, Finance, Insurance,
Public administration, Defense and so forth. This paper is an analysis of GST idea,
advantage and effect on Indian economy.
Introduction - The Goods and Services Tax (GST) is an immense idea that improves the
mammoth expense structure by supporting and upgrading the financial development of a
nation. GST is a complete assessment demand on manufacturing, sale and consumption of
goods and services at a national level. The Goods and Services Tax Bill or GST Bill,
likewise alluded to as The Constitution (One Hundred and Twenty-Second Amendment)
Bill, 2014, starts a Value included Tax to be actualized a national level in India. GST will
be a roundabout assessment at all the phases of creation to achieve consistency in the
framework.
On bringing GST into existence, there would be amalgamation of Central and State
charges into a Single Tax Payment system. It would likewise improve the situation of
India in both, domestic and in addition global market. At the shopper level, GST would
lessen the general taxation rate. Under this framework, the purchaser pays the final duty
however an effective information charge credit framework guarantees that there is no
cascading of duties assess on impose paid on inputs that go into manufacture of products.
In order to avoid the payment of multiple taxes such as excise duty and service tax
at Central level and VAT at the State level, GST would bind together these duties and
make a uniform market all through the nation. Combination of different taxes into a GST
framework will realize a powerful cross-usage of credits. The present framework charges
generation, while the GST will plan to impose utilization.

Goods and Service Tax

GST is a single Indirect tax that combines many Indirect taxes as Service tax, Central
Excise, VAT etc. GST rates in India are 0%, 5%, 12%, 18%, 28%.

• It is biggest Indirect tax reform since Independence.

• It will be levied when a customer will purchase a good or a service.

• The GST Bill will create a single market for more than a dozen state levies.

• The tax system is the backbone of any developing nation.

• More than 140 Countries have already introduced GST.

• France was the first country to introduce GST system in 1954.

 Gross Domestic Product

• Gross Domestic Product (GDP) is the market value of all goods and services
produced in a time period (quarterly or yearly).

• The GDP estimates are generally used to determine the Economic performance of
whole country or a particular sector, just to make International comparisons.

• GDP is a Measure of Economy of country.

• The GDP Estimates are based on Agriculture, forestry and fishing, Mining,
Manufacturing, Electricity, Gas, water supply, hotels and Transport &
communication and services Financial, insurance, real estate etc.
Positive Impact -

• GDP growth hit a three-year low of 5.7 % in the first Quarter and in Second
Quarter GDP has growth of 6.3 %.
• GST is helpful to reduce transportation cost which has made a unified market in
terms of tax-implementation.
• After GST implementation the export of goods and services has become
competitive because of a null impact of cascading effects of taxes on goods and
products.
• GST has made business easier than before. India’s Ease of doing business rank
became 100 which have a jump of 30 points first time in Indian History.
• Increase in currency value. The Currency Value of India is 1USD = 64.08 INR
which was three months ago 68.3.
• The transaction of goods and services will be seamless across the states.
Other Impact –

• Due Registration of GSTIN (GST identification number) for Merchant’s market

was slowed down for a month.
• India’s Industrial production growth slowed in September from a nine-month high
in August although IIP rose 3.8% in September, compared with upward revised
4.5% in August.

Conclusion -

As every coin has two faces if it is not unbiased in the same way it is tried here to
familiarize the things related to GST with both perspective. So it can be seen that there is
increase in Growth rate of GDP in these second Quarter of 2017-18. Since we have only
three month data cannot be sure too about the Influence of GST. We can have a study on
activities like GST which are implemented in developed nations which will help India to
become a developed country.

References -

1. A Dash “POSITIVE AND NEGATIVE IMPACT OF GST ON INDIAN

ECONOMY” International Journal of Management and Applied Science, ISSN:
2394-7926 Volume-3, Issue-5, May-2017.
2. Dani S (2016) A Research Paper on an Impact of Goods and Service Tax (GST) on
Indian Economy. Bus Eco J 7: 264. doi: 10.4172/2151-6219.1000264.
3. A Dash, (2017) “A Study on Socio Economic Effect of Demonetization in India”,
International Journal of Management and Applied Science (IJMAS), pp. 13-15,
Volume-3, Issue-3.
4. The Economic Times Featured Articles from The Economic Times.
5. CSO Ministry of statistics and programme implementation India.
6. GST India (2015) Economy and Policy.

7. Wikipedia.