GST (Goods and Services Tax) – the most talked about “one nation, one tax” initiative by the Indian Government is a unified Indian taxation system. The very initial impact of GST was on our mobile phones as they were loaded with funny messages, viral images and jokes about the same. In due course, the vendors, the Chartered Accountants, the start-up owners, the Government, the industries and the common men were busy in understanding its impact on their respective accounts.
The much awaited GST Act came into effect on 1st July, 2017 when India was converted into a unified common marketplace, and every Indian celebrated this notable achievement.
Instead of levying various taxes on goods and services, the Government of India brilliantly enacted the GST Act and introduced an all inclusive indirect tax rate for goods and services throughout the country. While the Indian consumers are relieved from the burden of extra taxes, the industrial sector is also experiencing its impact in the form of better prospects.
GST is a plethora of benefits and surprises for everyone. It has brought forth simplicity and effectiveness of the government administrative systems. Let us check out the multifaceted advantages and avenues that GST has brought with it for the Indian industries.
The convenient and interactive online portal
Before enactment of GST Act, every industry had to file returns, make payments, register for different licenses, etc. But as GST implementation is infused with advanced Information Technology, the business owners and industries will find ease in all the compliance procedures. They can also utilize the online portals effectively for complying with laws and to get their doubts resolved within timelines.
Lucrative opportunities for business expansion throughout the country
Earlier, if any industry had to expand its operations to another state or states, it would require complying with different tax laws and payment of taxes. With the advent of GST, the whole country will have a cohesive tax structure. As a result, an industry can now easily expand its business horizon to different parts of the country with considerable ease and comfort.
No more hidden transaction costs
Before the implementation of GST, small-scale and medium-scale industries feared to risk their capital and resources to expand or diversify their business. This was because of the hidden transaction costs involved in the trade or conducting business activities. Now, with the GST enactment, the hidden transaction costs would drop down considerably. As a result, the business owners can take risks, leading to competitiveness in the industrial sector.
Meticulous and transparent records
As we mentioned earlier, there are several hidden costs that are imposed on business transactions. Every industry makes efforts to maintain records and attempts to include each and every cost incurred. The GST implementation would minimize this hassle to a maximum extent. It will also lead to minimal possibilities of cascading of taxes.
Broader avenues for international exports
The industries can now boost up their production as the hidden costs, transaction costs and compliance expenditure would be erased significantly. Moreover, the previous indirect taxes such as Central States Tax, etc. would also not be visible in the picture. Hence, an industry owner can grab productive opportunities of exports in the international marketplace. As a result, the country’s exports will also mount up significantly.
Conclusively, GST is a bag full of constructive goodies for the industrial sector.