New Delhi: It has been termed a potential game changer, the single biggest tax reform undertaken by India in 70 years of independence, one the government says is founded on the concept of “one nation, one market, one tax.”
The moment, which India has waited for more than a decade, is finally beckoning. On 1 July, a single indirect tax regime will kick into force in Asia’s third largest economy, dismantling inter-state barriers to trade in goods and services.
Tonight, as the clock strikes 12 midnight a gong will sound in Parliament House Central Hall to officially announce GST launch. It will usher in a new era of taxes in India. Yes, the much-awaited Goods and Services Tax (GST) will be applicable from midnight tonight. The GST, a single tax, will replace many state and central taxes and cesses. The GST will replace taxes such as VAT, sales tax, excise tax, luxury tax, entertainment tax, etc. The new tax regime will convert a nation of diverse taxes into a nation of a single tax. This would make India a single market with a uniform tax structure. This would mean that prices of most items will be changed.
Senior economist and Niti Aayog member Bibek Debroy said that one of the major problems with the present GST Goods and Services Tax (GST) is its numerous rates structure, IANS revealed. He said that multiple rates of GST emerge from desire to tax those items which are considered luxury through the means of indirect tax and not the direct ones. Speaking at the Aaj Tak GST Conclave, the economist said that the multiple rates are coming from the desire to drive other ends through indirect tax policy and other concerns of the state governments.