A MINOR PROJECT

REPORT
ON

“GST IMPACT IN INDIA”

Supervised by :- Submitted by:-

(Manjeet Yadav) (Anuj Shukla)
(B.com 6th semester)
(2111022010008)

FACAULTY OF COMMERCE
SHRI MAHESH PRASAD DEGREE COLLEGE
UNIVERSITY OF LUCKNOW
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CERTICATE

This is to certify that Mr. Anuj Shukla, students of B.com (6th

Semester) has submitted the project report entitled “IMPACT OF
GST IN INDIA” in the partial fulfilment of the requirement for the
award of degree of BACHELOR OF COMMERCE the Faculty of
Commerce, Shri Mahesh Prasad Degree College, Bindua, Lucknow.
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DECLARATION

This is to certify that the project titled "Impact of GST in India" is

a record of original work carried out by Anuj Shukla, a student of
Bachelor of Commerce (B.com) under the guidance of Mr.
Manjeet Yadav.

The project has been submitted in partial fulfilment of the

requirements for the award of the degree of Bachelor of Commerce
at Shri Mahesh Prasad Degree College affiliated to
UNIVERSITY OF LUCKNOW.

I declare that this project is my own work and has not been
submitted to any other institution for the award of any degree or
diploma.

Sign. of Student Teacher Sign.

Anuj shukla
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ACKNOWLEDGEMENT

I am glad to express my profound sentiments of gratitude to all who rendered their valuable
help and assist in successful completion of this project report titled “IMPACT OF GST IN
INDIA”.
It is my great pleasure to have this opportunity to express my sense of gratitude to our head
of the department Mr. Anupam Suman Trivedi. It is due to his encouragement which cannot
be completed without his help.
I would like to add my special thanks towards MR. Manjeet Yadav for their able guidance and
support in successful completion of this minor project.
I want to express my gratitude towards Faculty of Commerce for the support and environment
provided to me.
My sincere gratitude goes to Shri Mahesh Prasad Degree College that gave me a chance to
brighten my academic qualification throughout this project.

ANUJ SHUKLA
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INDEX
Sr. No. Particulars Page no.
1. Certificate 2
2. Declaration 3
3. Acknowledgement 4
4. Unit-1 Introduction and overview of 6-24
GST
5. Unit-2 Literature Review 25-27
6. Unit-3 Research Methodology 28-31
7. Unit-4 Data Analysis and Interpretation 32-53
8. Unit-5 Finding and Conclusions 54-62
9. BIBLOGRAPHY 63-64
10. QUESTIONNAIRE 65-67
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UNIT - 1
Introduction and Overview
Of
GST

1.1 Introduction
1.2 The Journey of GST in INDIA
1.3 Historical Context of Taxation in India
a. Pre-GST Tax Structure
b. Challenges in Pre- GST Era
1.4 Objectives Of GST
1.5 Advantage Of GST
1.6 Components Of GST
1.7 New Compliance Under GST
1.8 How GST helps in Price Reduction ?
a. Literature
b. Illustration
1.9 GST Council
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1.1 Introduction
Goods and services tax (GST) has been identified as one of the most important tax reforms
Post Independence. GST is a path breaking indirect tax reform which will create a common
national market by removing inter-state trade barriers. GST has subsumed (absorbed or
include) multiple indirect taxes imposed by central and state.

GST is known as the Goods and Services Tax. It is an indirect tax which has replaced many
indirect taxes in India such as the excise duty, VAT, services tax, etc. The Goods and Service
Tax Act was passed in the Parliament on 29th March 2017 and came into effect on 1st July
2017.
In other words, Goods and Service Tax (GST) is levied on the supply of goods and services.
Goods and Services Tax Law in India is a comprehensive, multi-stage, destination-based
tax that is levied on every value addition. GST is a single domestic indirect tax law for the
entire country.
Before the Goods and Services Tax could be introduced, the structure of indirect tax levy in
India was as follows:
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Under the GST regime, the tax is levied at every point of sale. In the case of intra-state sales,
Central GST and State GST are charged. All the inter-state sales are chargeable to the
Integrated GST.
Now, let us understand the definition of Goods and Service Tax, as mentioned above, in
detail.

Multi-stage
An item goes through multiple change-of-hands along its supply chain: Starting from
manufacture until the final sale to the consumer.
Let us consider the following stages:
1. Purchase of raw materials
2. Production or manufacture
3. Warehousing of finished goods
4. Selling to wholesalers
5. Sale of the product to the retailers
6. Selling to the end consumers
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Value Addition

A manufacturer who makes biscuits buys flour, sugar and other material. The value of the
inputs increases when the sugar and flour are mixed and baked into biscuits.
The manufacturer then sells these biscuits to the warehousing agent who packs large
quantities of biscuits in cartons and labels it. This is another addition of value to the biscuits.
After this, the warehousing agent sells it to the retailer.
The retailer packages the biscuits in smaller quantities and invests in the marketing of the
biscuits, thus increasing its value. GST is levied on these value additions, i.e. the monetary
value added at each stage to achieve the final sale to the end customer.

Destination-Based
Consider goods manufactured in Maharashtra and sold to the final consumer in Karnataka.
Since the Goods and Service Tax is levied at the point of consumption, the entire tax revenue
will go to Karnataka and not Maharashtra. The Goods and Services Tax (GST) is indeed a
destination-based tax system. In a destination-based tax, the tax is levied at the point of
consumption or sale, rather than at the point of origin or production. This means that the
tax revenue is collected by the state where the goods or services are consumed, not where
they are produced or supplied. The destination principle ensures that the tax burden falls on
the final consumer, regardless of the supply chain involved.

For example - If A in Gujarat produces the goods and sells the goods to B in Rajasthan, then
in such case the tax should be levied and collected and should accrue on the goods in the
State of Rajasthan and not in the State of Gujarat. The revenue in the case of Destination
Based taxation belongs to the place, where the goods are finally consumed and not to the
State where the goods are produced.
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1.2 The Journey of GST in India

The GST journey began in the year 2000 when a committee was set up to draft law. It took
17 years from then for the Law to evolve. In 2017, the GST Bill was passed in the Lok Sabha
and Rajya Sabha. On 1st July 2017, the GST Law came into force.
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1.3 Historical Context of Taxation in India

a. Pre-GST Tax Structure
Before the introduction of the Goods and Services Tax (GST), India’s indirect tax system was
characterized by a multitude of central and state taxes, leading to a complex and often
inefficient tax environment. The central government levied taxes such as the Central Excise
Duty, Service Tax, and the Central Sales Tax (CST), while state governments imposed, Value
Added Tax (VAT), Entry Tax, Luxury Tax, and several other local taxes. This multiplicity of
taxes resulted in a cascading effect, where taxes were levied on top of other taxes, increasing
the cost of goods and services. For instance, a product would be taxed at the manufacturing
stage with an excise duty, and again at the sale stage with VAT, without any provision for
input tax credit across different stages of production and distribution. This led to higher tax
burdens on consumers and reduced competitiveness for businesses due to higher
production costs.
Moreover, the lack of uniformity in tax rates and regulations across states created significant
challenges for businesses operating in multiple states. Each state had its own set of rules,
rates, and procedures for VAT and other local taxes, resulting in a fragmented market and
increased compliance costs. The central sales tax, applicable on inter-state sales, further
complicated matters by creating tax barriers to the free flow of goods across state borders.
Additionally, the absence of a seamless credit mechanism meant that businesses could not
claim input credits for certain taxes paid, exacerbating the cascading tax effect and
increasing overall tax liabilities.
This disjointed tax structure also fostered tax evasion and corruption, as the complex web of
taxes made compliance difficult and created opportunities for tax avoidance. The
administrative burden on both businesses and tax authorities was substantial, with multiple
filings, assessments, and audits required for different taxes. The pre-GST tax regime thus
posed significant obstacles to economic efficiency, ease of doing business, and the
establishment of a unified national market. The need for a comprehensive reform to simplify
the tax structure, eliminate the cascading effect, and create a more transparent and efficient
system was widely recognized, setting the stage for the implementation of GST.
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In the earlier indirect tax regime, there were many indirect taxes levied by both the state
and the centre. States mainly collected taxes in the form of Value Added Tax (VAT). Every
state had a different set of rules and regulations.
Inter-state sale of goods was taxed by the centre. CST (Central State Tax) was applicable in
case of inter-state sale of goods. The indirect taxes such as the entertainment tax, octroi and
local tax were levied together by state and centre. These led to a lot of overlapping of taxes
levied by both the state and the centre.
For example, when goods were manufactured and sold, excise duty was charged by the
centre. Over and above the excise duty, VAT was also charged by the state. It led to a tax on
tax effect, also known as the cascading effect of taxes.
The following is the list of indirect taxes in the pre-GST regime:
1. Central Excise Duty
2. Duties of Excise
3. Additional Duties of Excise
4. Additional Duties of Customs
5. Special Additional Duty of Customs
6. Cess
7. State VAT
8. Central Sales Tax
9. Purchase Tax
10. Luxury Tax
11. Entertainment Tax
12. Entry Tax
13. Taxes on advertisements
14. Taxes on lotteries, betting, and gambling
CGST, SGST, and IGST have replaced all the above taxes.
However, certain taxes such as the GST levied for the inter-state purchase at a concessional
rate of 2% by the issue and utilisation of ‘Form C’ is still prevalent.
It applies to certain non-GST goods such as:
1. Petroleum crude;
2. High-speed diesel
3. Motor spirit (commonly known as petrol);
4. Natural gas;
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5. Aviation turbine fuel; and

6. Alcoholic liquor for human consumption.
It applies to the following transactions only:
Resale
Use in manufacturing or processing
Use in certain sectors such as the telecommunication network, mining, the generation or
distribution of electricity or any other power sector

b. Challenges in Pre-GST Era

1. Multiplicity of Taxes:

• Central Taxes: Central Excise Duty, Service Tax, Central Sales Tax (CST).
• State Taxes: Value Added Tax (VAT), Entry Tax, Luxury Tax, and various local
taxes.
• Resulted in a cascading effect of "tax on tax," increasing the final price of
goods and services.

2. Lack of Uniformity:

• Different VAT laws, rates, and compliance requirements across states.

• Created a non-homogeneous market environment.
• Increased compliance costs and administrative burdens for businesses
operating in multiple states.

3. Inter-State Sales Challenges:

• CST on inter-state sales without input tax credit.

• Created tax barriers to the free flow of goods across state borders.
• Inhibited the creation of a single, unified national market.

4. Tax Evasion and Corruption:

• Complexity and opaqueness of the tax structure provided opportunities for

tax avoidance.
• Reduced overall tax base and government revenue.
• Compliance was arduous, requiring multiple returns and numerous
assessments and audits for different taxes.

5. Administrative Inefficiencies:
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• Separate and overlapping jurisdictions of central and state tax authorities.

• Led to disputes, litigation, and slow resolution processes, adding to business
costs.
• Absence of robust IT infrastructure for tax administration, resulting in manual
handling, delays, and inaccuracies.

6. Increased Costs for Businesses:

• High compliance costs due to varying state-specific tax laws and multiple
filings.
• Increased administrative burden due to the complex tax regime.
• Reduced profit margins due to the cascading effect and lack of input tax
credit.

7. Deterrent to Investment and Growth:

• The overall complexity and inefficiency of the tax system deterred

investment.
• Created a challenging environment for business growth.
• Highlighted the need for tax reform to simplify the system, enhance
transparency, and create a more business-friendly environment.

The introduction of GST aimed to address these issues by subsuming multiple taxes into a
single, unified tax and creating a streamlined and efficient tax regime.

Certainly! Let’s delve into the challenges faced during the pre-GST era in India. Before the
implementation of the Goods and Services Tax (GST), the tax landscape was quite complex.
Here are some key challenges:
1. Multiple Taxes
2. Lack of Uniformity
3. Cascading Effects
4. Complex Compliance
5. Disputes and Litigation
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1.4 Objectives Of GST

. To achieve the ideology of ‘One Nation, One Tax’
GST has replaced multiple indirect taxes, which were existing under the previous tax regime.
The advantage of having one single tax means every state follows the same rate for a
particular product or service. Tax administration is easier with the Central Government
deciding the rates and policies. Common laws can be introduced, such as e-way bills for
goods transport and e-invoicing for transaction reporting. Tax compliance is also better as
taxpayers are not bogged down with multiple return forms and deadlines. Overall, it’s a
unified system of indirect tax compliance.

. To subsume a majority of the indirect taxes in India

India had several erstwhile indirect taxes such as service tax, Value Added Tax (VAT), Central
Excise, etc., which used to be levied at multiple supply chain stages. Some taxes were
governed by the states and some by the Centre. There was no unified and centralised tax on
both goods and services. Hence, GST was introduced. Under GST, all the major indirect taxes
were subsumed into one. It has greatly reduced the compliance burden on taxpayers and
eased tax administration for the government.

. To eliminate the cascading effect of taxes

One of the primary objectives of GST was to remove the cascading effect of taxes. Previously,
due to different indirect tax laws, taxpayers could not set off the tax credits of one tax
against the other. For example, the excise duties paid during manufacture could not be set
off against the VAT payable during the sale. This led to a cascading effect of taxes. Under GST,
the tax levy is only on the net value added at each stage of the supply chain. This has helped
eliminate the cascading effect of taxes and contributed to the seamless flow of input tax
credits across both goods and services.

. To curb tax evasion

GST laws in India are far more stringent compared to any of the erstwhile indirect tax laws.
Under GST, taxpayers can claim an input tax credit only on invoices uploaded by their
respective suppliers. This way, the chances of claiming input tax credits on fake invoices are
minimal. The introduction of e-invoicing has further reinforced this objective. Also, due to
GST being a nationwide tax and having a centralised surveillance system, the clampdown on
defaulters is quicker and far more efficient. Hence, GST has curbed tax evasion and
minimised tax fraud from taking place to a large extent.

. To increase the taxpayer base

GST has helped in widening the tax base in India. Previously, each of the tax laws had a
different threshold limit for registration based on turnover. As GST is a consolidated tax
levied on both goods and services both, it has increased tax-registered businesses. Besides,
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the stricter laws surrounding input tax credits have helped bring certain unorganised sectors
under the tax net. For example, the construction industry in India.

. Online procedures for ease of doing business

Previously, taxpayers faced a lot of hardships dealing with different tax authorities under
each tax law. Besides, while return filing was online, most of the assessment and refund
procedures took place offline. Now, GST procedures are carried out almost entirely online.
Everything is done with a click of a button, from registration to return filing to refunds to e-
way bill generation. It has contributed to the overall ease of doing business in India and
simplified taxpayer compliance to a massive extent. The government also plans to introduce
a centralised portal soon for all indirect tax compliance such as e-invoicing, e-way bills and
GST return filing.

. An improved logistics and distribution system

A single indirect tax system reduces the need for multiple documentation for the supply of
goods. GST minimises transportation cycle times, improves supply chain and turnaround
time, and leads to warehouse consolidation, among other benefits. With the e-way bill
system under GST, the removal of interstate checkpoints is most beneficial to the sector in
improving transit and destination efficiency. Ultimately, it helps in cutting down the high
logistics and warehousing costs.

. To promote competitive pricing and increase consumption

Introducing GST has also led to an increase in consumption and indirect tax revenues. Due to
the cascading effect of taxes under the previous regime, the prices of goods in India were
higher than in global markets. Even between states, the lower VAT rates in certain states led
to an imbalance of purchases in these states. Having uniform GST rates have contributed
to overall competitive pricing across India and on the global front. This has hence increased
consumption and led to higher revenues, which has been another important objective
achieved.

. Product Competitiveness:
GST aligns India’s tax system with international standards. By eliminating the cascading
effect, production costs decrease. As a result, Indian products become more competitive in
the global market.

In summary, GST aims to simplify taxation, promote ease of doing business, enhance
revenue collection, and create a level playing field for businesses. It has been a significant
reform in India’s tax landscape1
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1.5 Advantages of GST

GST has mainly removed the cascading effect on the sale of goods and services. Removal of
the cascading effect has impacted the cost of goods. Since the GST regime eliminates the tax
on tax, the cost of goods decreases.
Also, GST is mainly technologically driven. All the activities like registration, return filing,
application for refund and response to notice needs to be done online on the GST portal,
which accelerates the processes.

• GST eliminates the cascading effect of tax, which means that there is no tax on
tax.
• GST has a higher threshold for registration, which benefits small businesses.
• GST has a composition scheme for small businesses, which allows them to pay tax
at a lower rate.
• GST has a simple and easy online procedure for registration, filing, and payment
of tax.
• GST has fewer compliances than the previous tax system.
• GST has a defined treatment for e-commerce operators, which reduces the
disputes and confusion.
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1.6 Components Of GST

There are three taxes applicable under this system: CGST, SGST & IGST.

CGST: It is the tax collected by the Central Government on an intra-state sale (e.g., a
transaction happening within Maharashtra)

SGST: It is the tax collected by the state government on an intra-state sale (e.g., a
transaction happening within Maharashtra)

IGST: It is a tax collected by the Central Government for an inter-state sale (e.g.,
Maharashtra to Tamil Nadu)

In most cases, the tax structure under the new regime will be as follows:

Transaction New Old Regime Revenue Distribution

Regime

Sale within the CGST + VAT + Central Revenue will be shared equally between the Centre
State SGST Excise/Service tax State

Sale to IGST Central Sales Tax + There will only be one type of tax (central) in case of
another State Excise/Service Tax state sales. The Centre will then share the IGST reven
on the destination of goods.

Illustration:
Let us assume that a dealer in Gujarat had sold the goods to a dealer in Punjab worth Rs.
50,000. The tax rate is 18% comprising of only IGST.
In such a case, the dealer has to charge IGST of Rs.9,000. This revenue will go to Central
Government.
The same dealer sells goods to a consumer in Gujarat worth Rs. 50,000. The GST rate on
goods is 12%. This rate comprises CGST at 6% and SGST at 6%.
The dealer has to collect Rs.6,000 as Goods and Service Tax, Rs.3,000 will go to the Central
Government and Rs.3,000 will go to the Gujarat government since the sale is within the
state.
This is how GST works as per transaction will happen and take place, it is all depends upon
the type of transaction whether it is inter-state or intra-state.
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1.7 New Compliances Under GST

Apart from online filing of the GST returns, the GST regime has introduced several new
systems along with it.

e-Way Bills:-
GST introduced a centralised system of waybills by the introduction of “E-way
bills”. This system was launched on 1st April 2018 for inter-state movement of goods and on
15th April 2018 for intra-state movement of goods in a staggered manner.
Under the e-way bill system, manufacturers, traders and transporters can generate e-way
bills for the goods transported from the place of its origin to its destination on a common
portal with ease. Tax authorities are also benefited as this system has reduced time at check
-posts and helps reduce tax evasion.

E-invoicing:-
The e-invoicing system was made applicable from 1st October 2020 for
businesses with an annual aggregate turnover of more than Rs.500 crore in any preceding
financial years (from 2017-18). Further, from 1st January 2021, this system was extended to
those with an annual aggregate turnover of more than Rs.100 crore.
These businesses must obtain a unique invoice reference number for every business-to-
business invoice by uploading on the GSTN’s invoice registration portal. The portal verifies
the correctness and genuineness of the invoice. Thereafter, it authorises using the digital
signature along with a QR code.
e-Invoicing allows interoperability of invoices and helps reduce data entry errors. It is
designed to pass the invoice information directly from the IRP to the GST portal and the e-
way bill portal. It will, therefore, eliminate the requirement for manual data entry
while filing GSTR-1 and helps in the generation of e-way bills too.

New compliances under GST include:

• Compliance related to Annual GST Return

• Composition Scheme under GST
• New/Unique series of invoice
• E-Invoicing
• QR Code
• HSN code requirements
• Renewal of LUT
• Quarterly Return Monthly Payment Scheme
• Updating of information on GST Registration Certificate and GST Portal
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1.8 How Has GST Helped in Price Reduction?

A. Literature:

During the pre-GST regime, every purchaser, including the final consumer paid tax on tax.
This condition of tax on tax is known as the cascading effect of taxes.
GST has removed the cascading effect. Tax is calculated only on the value-addition at each
stage of the transfer of ownership. The indirect tax system under GST will integrate the
country with a uniform tax rate. It will improve the collection of taxes as well as boost the
development of the Indian economy by removing the indirect tax barriers between states .

B. Illustration:

Based on the above example of the biscuit manufacturer, let’s take some actual figures to
see what happens to the cost of goods and the taxes, by comparing the earlier GST regimes.

Tax calculations in earlier regime:

Action Cost (Rs) Tax rate at 10% (Rs) Invoice Total (Rs)

Manufacturer 1,000 100 1,100

Warehouse adds a label and repacks at Rs.300 1,400 140 1,540

Retailer advertises at Rs. 500 2,040 204 2,244

Total 1,800 444 2,244

The tax liability was passed on at every stage of the transaction, and the final liability comes
to a rest with the customer. This condition is known as the cascading effect of taxes, and the
value of the item keeps increasing every time this happens.

The old regime is the tax system that prevailed before the introduction of the new regime.
Under this regime, there are over 70 exemptions and deductions available, including HRA
and LTA, that can reduce your taxable income and lower tax payments. The most popular
and generous deduction is Section 80C, which allows for a reduction of taxable income up to
Rs.1.5 lakh. The taxpayers are given a choice between the old and the new tax regime. This
is how tax was calculated in old GST regime.

Tax calculations in current regime:

 21

Action Cost (Rs) Tax rate at Tax liability to Invoice

10% (Rs) be deposited Total (Rs)
(Rs)

Manufacturer 1,000 100 100 1,100

Warehouse adds label and repacks at Rs. 300 1,300 130 30 1,430

Retailer advertises at Rs. 500 1,800 180 50 1,980

Total 1,800 180 1,980

In the case of Goods and Services Tax, there is a way to claim the credit for tax paid in
acquiring input. The individual who has already paid a tax can claim credit for this tax when
he submits his GST returns.

In the end, every time an individual is able to claims the input tax credit, the sale price is
reduced and the cost price for the buyer is reduced because of lower tax liability. The final
value of the biscuits is therefore reduced from Rs.2,244 to Rs.1,980, thus reducing the tax
burden on the final customer.

A new tax regime was introduced in Budget 2020 wherein the tax slabs were altered, and
taxpayers were offered concessional tax rates. However, those who opt for the new regime
cannot claim several exemptions and deductions, such as HRA, LTA, 80C, 80D , and more.
Because of this, the new tax regime did not have many takers. The government in the
Budget 2023 introduced 5 key changes, which remain the same even for FY 2024-2025 since
no changes were made in the Interim Budget 2024, to encourage taxpayers to adopt the
new regime. They are:

Higher Tax Rebate Limit: Full tax rebate on an income up to ₹7 lakhs has been
introduced. Whereas this threshold is ₹5 lakhs under the old tax regime. This means that
taxpayers with an income of up to ₹7 lakhs will not have to pay any tax at all under the new
tax regime!

Streamlined Tax Slabs: The tax exemption limit has been increased to ₹3 lakhs, and the
new tax slabs are. These show on how much income total of and what are the rate pf GST on
that income. Both tax slabs are alternative to each other where higher tax rebate limit is up
to 7 lakhs and threshold.
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1.9 GST Council

A single common “Goods and Services Tax (GST)” was proposed and given a go-ahead in
1999 during a meeting between the Prime Minister Mr. Atal Bihari Vajpayee and his
economic advisory panel. Mr Vajpayee set up a committee headed by the then finance
minister of West Bengal, Asim Dasgupta to design a GST model.
Later, Finance Minister Mr. P Chidambaram in February 2006 continued work on the same. It
finally was implemented on July 1st, 2017 to be a comprehensive, destination-based indirect
tax that has replaced various indirect taxes that were implemented by the states and Centre
such as VAT, excise duty, and others. The government of India also formed a GST Council to
govern the GST rules. The last GST Council meeting has happened on 7th October 2023.

Latest Updates

7th October 2023

The 52nd GST Council took place on Saturday, 7th October 2023 at Sushma Swaraj Bhavan
in New Delhi. The Council meeting reviewed the progress by states in passing amendments
with respect to the online gaming taxation to the state GST laws. Read the highlights here.

2nd August 2023

The 51st GST Council meeting took place on Wednesday, 2nd August 2023 via video
conferencing. The Council is discussed and approved the rules to implement the 28% GST
levy on casinos, race courses and online gaming.

11th July 2023

The 50th GST Council meeting was held on 11th July 2023, Tuesday, at New Delhi. It marks
50 meetings by the GST Council since the inception of GST. A new GST Rule was
recommended to intimate taxpayers for differences between GSTR-2B and GSTR-3B and
get response. Further, a final call was taken to tax online gaming, casinos and horse racing
at 28% on the face value. Furthermore, many decisions were taken to reduce GST rate on
goods and services.

Why do we need a GST Council?

GST Council is an apex member committee to modify, reconcile or to procure any law or
regulation based on the context of goods and services tax in India. The council is headed by
the union finance minister Mrs. Nirmala Sitharaman, who is assisted by finance ministers of
all the states of India.
The last Council meeting held was the 52nd GST council meeting, which was held on 07th
October 2023. The meeting was chaired by Finance Minister Smt. Nirmala Sitharaman and
attended by the Finance Ministers of the states and Union Territories (UTs), and other senior
officers of both, the Ministry of Finance (MoF) and the states and UTs.
The GST council is the key decision-making body that will take all important decisions
regarding the GST. The GST Council decides tax rates, tax exemptions, the GST return due
dates, tax laws, and other compliance deadlines, keeping in mind special rates and
 23

provisions for some states. The predominant responsibility of the GST Council is to ensure to
have one uniform tax rate for goods and services across the nation.

. GST COUNCIL STRUCTURE

Article 279 (1) of the amended Indian Constitution states that the GST Council has to be
constituted by the President within 60 days of the commencement of the Article 279A.
According to the article, GST Council will be a joint forum for the Centre and the States.
Here's the hierarchy of the GST council:

Designation in GST
Designation of the person
Council

Union Finance Minister Chairperson

Union Minister of State - In charge of Revenue of Finance Member

Minister in charge of finance or taxation or any other Minister nominated by each

Members
state government
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. GST COUNCIL RECOMMENDATIONS

Article 279A (4) specifies that the Council will make recommendations to the Union and the
states on the important issues related to GST, such as, the goods and services will be subject
or exempted from the GST. Further, they lay down GST laws, principles that govern the
following:

. Place of supply
. Threshold limits
. GST rates on goods and services
. Special rates for raising additional resources during a natural calamity or disaster
. Special GST rates for certain states

. Features of GST Council

. GST Council office is set up in New Delhi
. Revenue Secretary is appointed as the Ex-officio Secretary to the GST Council
. Central Board of Indirect Taxes and Customs (CBIC) is included as the chairperson as a . .
permanent invitee (non-voting) to all GST Council proceedings
. Create a post for Additional Secretary to the GST Council
. Create four posts of commissioner in the GST Council Secretariat (This is at the level of Joint
Secretary)
. GST Council Secretariat will have officers taken on deputation from both the Central and
State Governments
The cabinet also provides funds for meetings the expenses (recurring and nonrecurring) of
the GST Council Secretariat. This cost is completely borne by the Central government.

On here we conclude on GST council that, the GST Council is authorised to determine the
rate of tax applicable under the GST model, tax exemption rules, the due date of submitting
GST forms, tax related laws and deadlines and special exemptions for some States of India.
The GST Council is tasked to ensure that one uniform rate of GST is applied on goods and
services all across India.
 25

UNIT- 2

Literature Review
 26

The Impact of Goods and Services Tax (GST) on India's Economy: A

Comprehensive Literature Review
Introduction: The Goods and Services Tax (GST) regime, introduced in India on July 1, 2017,
marked a significant milestone in the country's tax reform history. This comprehensive tax
overhaul aimed to streamline the indirect tax structure, foster economic growth, enhance
tax compliance, and create a unified national market. Since its implementation, scholars,
policymakers, and analysts have extensively studied the multifaceted impacts of GST on
various aspects of the Indian economy. This literature review synthesizes and analyses the
findings of existing research to provide a comprehensive understanding of the implications
of GST on economic growth, efficiency, competitiveness, inflation, revenue collection,
sectoral performance, and the informal sector.

1. Economic Growth and Efficiency: One of the primary objectives of GST implementation
was to boost economic growth and enhance efficiency in tax administration. Gupta and Jain
(2018) conducted a comprehensive study on the impact of GST on economic growth in India.
They found that GST contributed positively to GDP growth rates by improving tax efficiency,
reducing tax evasion, and eliminating the cascading effect of taxes. The study observed a
gradual increase in GDP growth in the post-GST period, indicating a positive correlation
between GST implementation and economic expansion. Furthermore, Gupta and Jain
emphasized that the simplification of the tax structure under GST facilitated ease of doing
business, thereby enhancing economic efficiency and productivity.

2. Business Competitiveness: Kumar and Gupta (2017) delved into the effects of GST on
business competitiveness in India. Their study highlighted how GST streamlined the tax
regime, reduced compliance costs, and eliminated tax barriers across state borders, thereby
enhancing the competitiveness of Indian businesses in the domestic and international
markets. The researchers noted that the rationalization of tax rates under GST led to a level
playing field for businesses, encouraging investment, innovation, and entrepreneurship.
Additionally, the study underscored the role of GST in improving supply chain efficiency and
reducing logistics costs, further enhancing business competitiveness.

3. Inflation: The impact of GST on inflation dynamics has been a subject of debate among
economists. Bhattacharya and Saxena (2019) conducted a comprehensive analysis of
inflation trends before and after the implementation of GST in India. Their study revealed
that while there was a short-term increase in inflation due to transitional disruptions and
supply chain adjustments, GST eventually contributed to lower inflation rates. The
researchers attributed this decline in inflation to the elimination of cascading taxes,
improved tax compliance, and enhanced supply chain efficiency facilitated by GST. However,
they cautioned that the inflationary impact of GST varied across different sectors and
geographical regions, warranting sector-specific policy interventions to mitigate adverse
effects.

4. Revenue Collection: The effectiveness of GST in mobilizing tax revenue has been a focal
point of research among scholars and policymakers. Gulati and Sharma (2018) conducted an
empirical study to assess the impact of GST on government revenue collection in India. Their
findings indicated that while there were initial challenges in revenue mobilization due to
teething issues such as rate rationalization, invoice matching, and compliance complexities,
GST eventually led to higher tax revenues over the long term. The study attributed this
 27

increase in revenue to the broadening of the tax base, improved tax compliance, and
enhanced enforcement mechanisms under the GST regime. Additionally, Gulati and Sharma
emphasized the importance of administrative reforms and capacity building to sustain
revenue growth under GST.

5. Sectoral Analysis: The heterogeneous nature of the Indian economy necessitates a

sectoral analysis to understand the differential impacts of GST across various industries.
Rajput and Verma (2020) conducted a comprehensive sectoral analysis to examine the
effects of GST on manufacturing, services, agriculture, and other key sectors. Their study
revealed that while GST had a positive impact on certain sectors by reducing tax burden,
simplifying compliance procedures, and promoting efficiency gains, it also posed challenges
for others, particularly those reliant on unorganized supply chains and input tax credit
mechanisms. The researchers emphasized the need for sector-specific policy interventions
and targeted support measures to address the concerns of adversely affected industries and
ensure inclusive growth under GST.

6. Informal Sector and SMEs: The informal sector and small and medium-sized enterprises
(SMEs) play a significant role in India's economy, and their adaptation to the GST regime has
been a subject of scholarly inquiry. Ramkumar (2018) conducted an in-depth study on the
impact of GST on the informal sector and SMEs. The study highlighted the initial challenges
faced by these sectors, including compliance burden, technological constraints, and liquidity
issues. However, it also identified opportunities for formalization, market integration, and
capacity building facilitated by GST. Ramkumar emphasized the importance of targeted
policy interventions, skill development initiatives, and access to credit to support the
transition of informal enterprises to the formal economy under GST.

7. International Comparisons: Drawing lessons from the experiences of other countries in

implementing GST can provide valuable insights for India's GST regime. Lahiri (2019)
conducted a comparative analysis of GST implementation across different countries to
identify best practices and policy recommendations for India. The study highlighted the
importance of stakeholder engagement, phased implementation, robust IT infrastructure,
and effective tax administration in ensuring the success of GST reforms. Lahiri underscored
the need for continuous monitoring, evaluation, and policy adaptation based on
international experiences to address implementation challenges and optimize the benefits of
GST in India.

Conclusion: The literature review provides a comprehensive overview of the impact of GST
on India's economy based on existing research and scholarly analysis. While GST has
demonstrated significant potential to enhance economic growth, efficiency,
competitiveness, and revenue collection, its implementation has also posed challenges,
particularly for certain sectors and segments of the economy. Addressing these challenges
requires targeted policy interventions, administrative reforms, and stakeholder engagement
to optimize the benefits of GST and ensure inclusive and sustainable growth. Future research
should focus on longitudinal studies, sector-specific analyses, and international comparisons
to further refine our understanding of the implications of GST on India's economic trajectory.
--- This extended literature review synthesizes the findings of various studies and provides a
comprehensive understanding of the impact of GST on India's economy, offering insights for
policymakers, researchers, and stakeholders.
 28

UNIT-3

RSEARCH METHODOLOGY

3.1 Research Problem

3.2 Research Objectives
3.3 Research Design
3.4 Research Instrument
3.5 Sampling Plan
3.6 Sampling Technique
3.7 Primary Data
3.8 Secondary Data
3.9 Data Analysis
3.10 Conclusion
 29

The research methodology for this minor project on the "Impact of GST in India" will
integrate both qualitative and quantitative approaches, ensuring a comprehensive analysis
of the subject. The study aims to evaluate the implications of the Goods and Services Tax
(GST) on various stakeholders and sectors within the Indian economy. This methodology is
designed to gather in-depth insights and robust data to address the research questions
effectively.

3.1 RESEARCH PROBLEM

The main focus of the research is to know the awareness of people towards GST and impacts
of it. GST is one of the most important factors to affect the people life as well as Indian
economy. This survey is conveyed to know whether the people are aware towards their
obligations for paying GST and other taxes and how people have opinion about the GST.
During this survey problem occur like some people are not aware about the GST, so this
makes problem to find such people who knows about it.

3.2 RESEARCH OBJECTIVES

Assess Business Impact: Evaluate how the introduction of GST has influenced business
operations, with a specific focus on small and medium-sized enterprises (SMEs) in terms of
compliance costs, operational challenges, and changes in profitability.

Analyse Consumer Impact: Investigate the effect of GST on consumer behaviour, including
changes in pricing, purchasing patterns, and consumer sentiment regarding the new tax
system.

Evaluate Sectoral Impact: Examine the impact of GST on different sectors of the economy,
such as manufacturing, services, retail, and agriculture, to understand sector-specific
challenges and benefits.

Compliance and Administrative Efficiency: Assess the effectiveness and efficiency of GST
compliance processes and administrative procedures from the perspective of businesses and
tax professionals.

Tax Revenue and Evasion: Analyse the impact of GST on government tax revenues and its
effectiveness in reducing tax evasion compared to the previous tax regime.

Economic Growth and Investment: Explore the broader economic implications of GST,
including its effect on economic growth, investment patterns, and the ease of doing business
in India.

Regional Disparities: Investigate any regional disparities in the impact of GST, identifying
states or regions that have benefited more or faced greater challenges due to the tax reform.
Policy Recommendations: Develop evidence-based recommendations for policymakers to
address identified challenges and enhance the effectiveness of GST in achieving its intended
objectives.
 30

3.3 RESEARCH DESIGN

The research design for this study on the impact of GST in India is structured to combine
both qualitative and quantitative methodologies, ensuring a holistic analysis of the subject.
The study begins with a comprehensive literature review to establish a theoretical
foundation and identify existing research gaps. Primary data collection will involve
administering structured surveys to a diverse group of stakeholders, including business
owners, tax professionals, and consumers, to gather quantifiable data on their experiences
and perceptions related to GST. Additionally, in-depth interviews with key informants such as
industry experts, policymakers, and financial analysts will provide qualitative insights into
the nuanced effects of GST on various sectors. Secondary data will be sourced from
government reports, financial records, and economic databases to supplement and validate
primary data findings. Statistical analysis will be conducted on the quantitative data using
tools such as regression analysis to identify trends and correlations, while thematic analysis
will be applied to the qualitative data to extract recurring themes and insights. This mixed-
methods approach is designed to capture the multifaceted impact of GST, offering a detailed
and balanced evaluation of its economic implications in India.

3.4 RESEARCH INSTRUMENT

A structured questionnaire was prepared and primary data were collected through survey
method. In secondary data, various websites. Text books are used to collect the information
about the topic.

3.5 SAMPLING TECHNIQUE

The sampling technique for this study on the impact of GST in India will employ a stratified
random sampling method to ensure representation across various segments of the
population. The sample will be stratified by key categories such as business size (small,
medium, large enterprises), industry sectors (manufacturing, services, retail, agriculture),
and geographic regions (urban and rural areas across different states). Within each stratum,
participants will be randomly selected to reduce bias and enhance the generalizability of the
findings. This approach ensures that diverse perspectives are captured, reflecting the varied
experiences and impacts of GST implementation across different stakeholder groups in the
Indian economy.

3.6 PRIMARY DATA COLLECTION

The primary data for this survey on GST and its impact are collected from survey basis which
is conducted on shop and from person to person such as employee. To ensure what are their
opinion with respect to GST, how they think GST are helpful for our nation or not. Primary
data is totally based on qualitative form and this data is collected from survey or it can be
also called surveyed data, which is not look to be wrong.

3.7 SECONDARY DATA COLLECTION

Secondary data will be crucial for this study and will be sourced from government
publications, such as reports from the Ministry of Finance, the Goods and Services Tax
 31

Council, and other relevant agencies. Additionally, data will be gathered from tax records,
financial statements, and economic surveys conducted by reputable institutions. This data
will help analyse the macroeconomic trends and patterns pre- and post-GST
implementation, providing a broader perspective on its impact. Statistical databases such as
the Reserve Bank of India (RBI), the Central Statistics Office (CSO), and other economic
forums will be utilized to collect relevant secondary data.
This data was collected from
different source of information such as text books, official websites and other websites to
get the information about GST pre-GST and post GST condition.

3.8 DATA ANALYSIS

Quantitative data analysis will involve the use of statistical tools and software to interpret
the collected data. Descriptive statistics will summarize the survey data, presenting findings
on the general perception and impacts of GST. Inferential statistics, such as regression
analysis, will be used to identify relationships between GST implementation and various
economic indicators like business turnover, profitability, and consumer prices.
Qualitative data from interviews will be analysed using thematic analysis. This process will
involve coding the data to identify recurring themes and patterns, providing deeper insights
into stakeholder experiences and the nuanced impacts of GST on different sectors. The
combination of these analytical techniques will ensure a comprehensive evaluation of both
measurable outcomes and subjective experiences.

3.9 CONCLUSION
The research methodology for this project is designed to be robust and comprehensive,
combining literature review, primary data collection through surveys and interviews, and
secondary data analysis. This mixed-methods approach will facilitate a thorough
understanding of the impact of GST in India, encompassing both quantitative and qualitative
perspectives. By employing a structured and detailed methodology, the study aims to
provide valuable insights into the efficacy of GST and its effects on the Indian economy,
offering recommendations for policymakers and stakeholders to enhance the tax
framework's effectiveness.
 32

UNIT- 4

Data Analysis
and
Interpretation

4.1 Previous Years GST Collection

4.2 Interpretations of Data
 33

4.1 PREVIOUS YEARS GST COLLECTION

Author has compiled Month-wise and Year wise figures of GST Collections from FY 2017-18
to FY 2020-21 and table shows Decline in GST collection for FY 2020-21 in comparison to FY
2019-20. Decline is mainly attributable to Lockdown Due to Covid-19. Figures are compiled
on the basis of Various Press Releases issued by PIB.

FROM YEAR – 2017-18 TO 2020-2021

 34

FROM YEAR 2020-21 TO 2022-23

The monthly average gross GST collection for the FYs 2021-22 & 2022-23 have shown 30%
and 22% year on year growth respectively. This was stated by Union Minister for State for
Finance Shri Pankaj Choudhary in a written reply to a question in Lok Sabha today.
The details of gross Goods and Services Tax collection on supply of goods and services
(Domestic + Imports) for the FY 2020-21, 2021-22 & 2022-23 are as under:

( Rs in Crore )
FY Collection Average monthly Collection
( In Rs ) ( In Rs )
2020-21 11,36,803 94,734

2021-22 14,83,291 1,23,608

2022-23 18,07,680 1,50,640

The Minister further stated that GST is paid on self-assessment basis and tax administration
at Central and State level is empowered to take action against cases where GST is not paid
and short paid. Detection of such cases and recovery of taxes not paid or short paid is a
continuous process.
Giving more details, the Minister stated that the Government, on the recommendations
of the GST Council, has been bringing several reforms in GST. These measures would
improve the GST compliance and increase the GST collection. These inter-alia include:

i. Structural changes like calibration of GST rates for correcting inverted duty structure
and pruning of exemptions;

ii. Measures for improving tax compliance such as mandating e-way bill, ITC matching,
mandating e-invoice, deployment of artificial intelligence and machine-based
analytics, Adhaar authentication for registration, calibrated action on non-filers, stop
filers, targeted assessment-based action on risky tax payer, integration of e-way bill
with fast tag etc.

iii. System based analytical tools and system generated red flag reports are being shared
with Central as well as State Tax authorities to take action against tax evaders.

****
 35

TOTAL GST COLLECTION ( F Y 2023-2024 )

GST revenue collection for April 2024 highest ever at Rs 2.10 lakh crore. GST collections
breach landmark milestone of ₹2 lakh crore. Gross Revenue Records 12.4% y-o-y growth.
Net Revenue (after refunds) stood at ₹1.92 lakh crore; 15.5% y-o-y growth.

The Gross Goods and Services Tax (GST) collections hit a record high in April 2024 at
₹2.10 lakh crore. This represents a significant 12.4% year-on-year growth, driven by a strong
increase in domestic transactions (up 13.4%) and imports (up 8.3%). After accounting for
refunds, the net GST revenue for April 2024 stands at ₹1.92 lakh crore, reflecting an impressive
15.5% growth compared to the same period last year.
Positive Performance Across Components:
Breakdown of April 2024 Collections:

• Central Goods and Services Tax (CGST): ₹43,846 crore;

• State Goods and Services Tax (SGST): ₹53,538 crore;

• Integrated Goods and Services Tax (IGST): ₹99,623 crore, including ₹37,826 crore
collected on imported goods;

• Cess: ₹13,260 crore, including ₹1,008 crore collected on imported goods.

Inter-Governmental Settlement: In the month of April, 2024, the central government settled
₹50,307 crore to CGST and ₹41,600 crore to SGST from the IGST collected. This translates to
a total revenue of ₹94,153 crore for CGST and ₹95,138 crore for SGST for April, 2024 after
regular settlement.
The chart below shows trends in monthly gross GST revenues during the current year. Table-
1 shows the state-wise figures of GST collected in each State during the month of April, 2024
as compared to April, 2023. Table-2 shows the state-wise figures of post settlement GST
revenue of each State for the month of April, 2024.
Table 1: State-wise growth of GST Revenues during April, 2024
 36

Table - 1
State/UT Apr-23 Apr-24 Growth (%)

Jammu and Kashmir 803 789 -2%

Himachal Pradesh 957 1,015 6%

Punjab 2,316 2,796 21%

Chandigarh 255 313 23%

Uttarakhand 2,148 2,239 4%

Haryana 10,035 12,168 21%

Delhi 6,320 7,772 23%

Rajasthan 4,785 5,558 16%

Uttar Pradesh 10,320 12,290 19%

Bihar 1,625 1,992 23%

Sikkim 426 403 -5%

Arunachal Pradesh 238 200 -16%

Nagaland 88 86 -3%

Manipur 91 104 15%

Mizoram 71 108 52%

Tripura 133 161 20%

Meghalaya 239 234 -2%

Assam 1,513 1,895 25%

West Bengal 6,447 7,293 13%

 37

Jharkhand 3,701 3,829 3%

Odisha 5,036 5,902 17%

Chhattisgarh 3,508 4,001 14%

Madhya Pradesh 4,267 4,728 11%

Gujarat 11,721 13,301 13%

Dadra and Nagar Haveli and Daman & Diu 399 447 12%

Maharashtra 33,196 37,671 13%

Karnataka 14,593 15,978 9%

Goa 620 765 23%

Lakshadweep 3 1 -57%

Kerala 3,010 3,272 9%

Tamil Nadu 11,559 12,210 6%

Puducherry 218 247 13%

Andaman and Nicobar Islands 92 65 -30%

Telangana 5,622 6,236 11%

Andhra Pradesh 4,329 4,850 12%

Ladakh 68 70 3%

Other Territory 220 225 2%

Grand Total 1,51,162 1,71,433 13%

 38

Table-2: SGST & SGST portion of IGST settled to States/UTs

April (Rs. in crore)

Pre-Settlement SGST Post-Settlement SGST[2]

State/UT Apr-23 Apr-24 Growth Apr-23 Apr-24 Growth

Jammu and Kashmir 394 362 -8% 918 953 4%

Himachal Pradesh 301 303 1% 622 666 7%

Punjab 860 999 16% 2,090 2,216 6%

Chandigarh 63 75 20% 214 227 6%

Uttarakhand 554 636 15% 856 917 7%

Haryana 1,871 2,172 16% 3,442 3,865 12%

Delhi 1,638 2,027 24% 3,313 4,093 24%

Rajasthan 1,741 1,889 9% 3,896 3,967 2%

Uttar Pradesh 3,476 4,121 19% 7,616 8,494 12%

Bihar 796 951 19% 2,345 2,688 15%

Sikkim 110 69 -37% 170 149 -12%

Arunachal Pradesh 122 101 -17% 252 234 -7%

Nagaland 36 41 14% 107 111 4%

Manipur 50 53 6% 164 133 -19%

Mizoram 41 59 46% 108 132 22%

Tripura 70 80 14% 164 198 21%

Meghalaya 69 76 9% 162 190 17%

Assam 608 735 21% 1,421 1,570 10%

 39

West Bengal 2,416 2,640 9% 3,987 4,434 11%

Jharkhand 952 934 -2% 1,202 1,386 15%

Odisha 1,660 2,082 25% 2,359 2,996 27%

Chhattisgarh 880 929 6% 1,372 1,491 9%

Madhya Pradesh 1,287 1,520 18% 2,865 3,713 30%

Gujarat 4,065 4,538 12% 6,499 7,077 9%

Dadra and Nagar Haveli and Daman 62

and Diu 75 22% 122 102 -16%

Maharashtra 10,392 11,729 13% 15,298 16,959 11%

Karnataka 4,298 4,715 10% 7,391 8,077 9%

Goa 237 283 19% 401 445 11%

Lakshadweep 1 0 -79% 18 5 -73%

Kerala 1,366 1,456 7% 2,986 3,050 2%

Tamil Nadu 3,682 4,066 10% 5,878 6,660 13%

Puducherry 42 54 28% 108 129 19%

Andaman and Nicobar Islands 46 32 -32% 78 88 13%

Telangana 1,823 2,063 13% 3,714 4,036 9%

Andhra Pradesh 1,348 1,621 20% 3,093 3,552 15%

Ladakh 34 36 7% 55 61 12%

Grand Total 47,412 53,538 13% 85,371 95,138 11%

 40

The expected Goods and Services Tax (GST) collection for the fiscal year 2024-2025 is
estimated to rise to ₹10.68 lakh crore, which represents an increase of ₹1.1 lakh crore
or 11.6% compared to the previous year1. This projection reflects the government’s efforts
to boost revenue through GST collections. It’s worth noting that GST revenue collection for
April 2024 reached a record high of ₹2.10 lakh crore, with a year-on-year growth of 12.4%2.
The positive performance across components, including domestic transactions and imports,
contributed to this milestone. As we move forward, achieving a monthly collection target of
₹2 lakh crore could be a realistic goal for the fiscal year 2025-26.

. Last Three year % change in Total GST Collection

FOR YEAR 2021-22 and 2022-23

Total collection in year 2021-22 = 1483291 crore

Total Collection in year 2022-23 = 1807680 crore
Increase in collection = 1807680-1483291= 324389 crore
 41

Actual increase (in %) = (324389/1483291)*100

= 21.86%

Similarly, for year 2022-23 to 2023-24

Total collection in year 2022-23 = 1807680 crore
Total collection in year 2023-24 = 20.14 lakh crore
Increase in collection = 2.07 lakh crore
Actual increase (in %) = 11.45 %
 42

4.2 Interpretation of Data

Q1. How do you get know about GST? From:

Table 1:

Particulars No. of Respondent Percentage

Friend/Family 15 30%
Mass Media 50 50%
Online source 20 20%

Other 15
TOTAL 100 100%

60

50

40
Family/Family

30 Mass Media
Online source

20 Other

10

0
Friend/Family Mass Media Online source Other

Interpretation: Most of the Client knows about GST From Mass Media.
 43

Q2. Gender
Table 2:

Particulars No. of Respondent Percentage

Male 70 70%

Female 30 30%
TOTAL 100 100%

Interpretation: 70% of them are male.

30% of them are female.
 44

Q3. Education ?

Table 3

Option No. of Respondents Percentage

SSC 10 10%

HSC 20 20%

Graduate 30 30%

Post-graduate 40 40%

Totals 100 100%

40%

35%

30%

25% Post-Graduate
Graduate
20%
HSC

15% SSC

10%

5%

0%
SSC HSC Graduate Post-Graduate

Interpretation: From the above diagram it is stated that most of the dealer are literate.
 45

Q4 . Professional status ?

Table 4
Option No. of Respondents Percentage

Student 35 35%

Working Professionals 64 64%

Unemployed 1 1%

Total 100 100%

70
60
50
40 Student
30 Working Professional
20 Unemployed
10 Unemployed
Working Professional
0
Student

Interpretation: From the above diagram it is stated that most of the persons who have
answered were the constructor.
 46

Q5. Years of experience ?

Table 5
Option No. of Respondents Percentage

Less than 5 40 40%

5-10 18 18%

10-15 25 25%

More than 15 17 17%

Totals 100 100%

40

35

30

25
More than 15
20
10_15
15 5_10
10 Less than 5
5

0
Less than 5
5_10
10_15
More than
15

Interpretation: From the above diagram it is stated that most of the constructor where
having less than 5 year of experience and only 17 are been having more than 15 year of
experience.
 47

Q6. Monthly Income ?

Table 6:
Option No. of Respondents Percentage

Less than 10,000 10 10%

10,000-30,000 61 61%

30,000-50,000 15 15%

50,000 & above 14 14%

Totals 100 100%

70

60

50

40

30 50,000 & above

20 30,000-50,000

10 10,000-30,000

0 Less than 10,000

Interpretation: From the above diagram it is stated that most of the persons who have
answered were the constructor and the most of the constructor were earning 10k-30k per
month .
 48

Q7. Do you agree with the implementation of GST in India?

Table 7:
Particulars No. of Respondent Percentage

Yes 70 70%
No 30 30%
TOTAL 100 100%

Interpretation: Most of the Client agree about the implementation of GST in India.
 49

Q10. Do you think all businesses need to be registered under GST?

Table 10:
Particulars No. of Respondent Percentage

Yes 80 80%
No 20 20%
TOTAL 100 100%

GST

Yes
No

Interpretation: 80% user think that all businesses need to be registered under GST.
 50

Q11. Whether there is increase in bank loan interest rate ?

Table 11:

Option No. of Respondents Percentage

Strongly Agree 50 50%

Agree 20 20%

Neutral 15 15%

Disagree 10 10%

Strongly Disagree 5 5%

Totals 100 100%

60

50

40
Strongly Agree
Agree
30
Nuetral

20 Disagree
Strongly Disagree
10

0
Strongly Agree agree Disagree Strongly
Disagree

Interpretation: Most of the constructor were agreed that there is increase in bank loan interest.
 51

Q11. Whether there is increase in bank loan interest rate ?

Table 11:

Option No. of Respondents Percentage

Strongly Agree 50 50%

Agree 20 20%

Neutral 15 15%

Disagree 10 10%

Strongly Disagree 5 5%

Totals 100 100%

50
45
40
35
30
Strongly Agree
25
Agree
20
15 Nuetral
10 Disagree
5 Strongly Disagree
0
Strongly
Agree
Agree Nuetral
Disagree
Strongly
Disagree

Interpretation: Most of the constructor were agreed that there is improved in the access of
bank loan interest.
 52

Q12. Whether there is increase in construction cost of new residential buildings ?

Table 14:

Option No. of Respondents Percentage

Strongly Agree 40 40%

Agree 20 20%

Neutral 25 25%

Disagree 10 10%

Strongly Disagree 15 15%

Totals 100 100%

INCREASE IN COST
45
40
35
30
Strongly Disagree
25
Disagree
20
Nuetral
15
Agree
10
Strongly Agree
5
0
Strongly Agree Nuetral Disagree Strongly
Agree Disagree

Interpretation: 40% of the constructor are strongly agreed that there is increase in construction
cost due to GST.
 53

Q13. How was your experience using GST?

Table 16:
Option No. of Respondents Percentage

Poor 10 10%

Satisfactory 20 20%

Good 30 30%

Excellent 40 40%

Totals 100 100%

Interpretation: From the above graph shows that Most of customer says excellent for Using GST.
 54

UNIT – 5

Finding and Conclusions

5.1 Summary of Findings

5.2 Overall Conclusion
5.3 Recommendations
 55

5.1 Summary of Findings

• Most of the Client know about GST From Mass Media.

• Most of the Client agree about the implementation of GST in India.

• Most of the Client think that implementing GST will cause higher price of goods
& services.
• 80% user think that all businesses need to be registered under GST.

• 65% user think that Goods & Service Tax is more beneficial to both
Government and people.
• 62% user think that GST will burden the people/consumer.

• 75% user think INIDA is ready for implementing GST system.

• From the above graph shows that Most of customer says excellent for using
GST.
• From the above graph shows that Most of customer says excellent for using
GST.
• From the above graph shows that Most of customer are neutral about that
GST is very good tax reforms for India. 25 % customer are dis-agree about
that GST is very good tax reforms for India.
• From the above graph shows that Most of customer are neutral about that
GST Has Increased the Various Legal Formalities. 25 % customer are Strongly
Agree about that GST Has Increased the Various Legal Formalities. And rest
customers are agree about that GST Has Increased The Various Legal
Formalities.
• 45% customer are Strongly Agree about GST has increased the tax burden .
 56

5.2 Overall Conclusion

GST shall be the mother of all Indian tax reforms of this century and it would subsume
most (if not all) of the existing Central and State level taxes on supply of goods and
services.
Accordingly, GST would have a significant impact on business environment and its
operations. When undertaking oversight of organizational readiness to adopt GST,
independent directors need to focus on the following aspects:
1 GST will have a multi-fold impact on operations – Besides the fiscal impact and tax
compliance, GST will have an impact on cash flows, product pricing, supply chain
arrangements, procurement, revenue recognition and the IT systems. It is therefore
important to assess whether the organization is undertaking a holistic impact assessment
of GST encompassing all of the above.

2 Assess the impact on financial results – GST will have an impact on the financial
statements; for example the top-line may get reduced in some cases (e.g. traded items)
due to elimination of tax cascading. The gross margins will also undergo changes as Cost
of Goods Sold may undergo changes as a result on input tax credits. For listed companies,
these changes will need to be factored in quarterly forecasts and earning releases to the
stock markets.

3 Monitor the impact on cash flows – Most of the planning in GST will revolve around
optimizing cash flows. The impact will be as a result of GST on imports, stock transfers
and changes in point of taxation/tax credits.
4 Organisations may need to re-design certain aspects of their Supply

Chain – The concept of mere supply of goods and services trigger tax liability under
GST as opposed to sale under the present VAT, will impact Sourcing, Production and
Distribution aspects of the Supply Chain. For instance, sourcing considerations would
involve revisiting sourcing mix (local, inter-state and imports), stock transfer policy and
renegotiation of vendor price due to the GST impact. From a production perspective,
GST impact would vary depending upon the manufacturing and distribution
arrangements e.g. own/ job-work/ contract manufacturing. The “Place of Supply” rules
will determine state where GST is to be deposited.
5 Understand the linkages, differences for companies implementing IFRS – For
companies implementing IFRS, the requirements under IFRS vary with those under GST.
 57

Organizations will need to consider necessary re-alignments within their IT systems to

effectively manage these differences. For instance, there could be possible differences
between GST levy date and date of revenue recognition, accounting for multiple element
arrangements (e.g. the invoice value includes a supply and maintenance element),
accounting for barter transactions, reconciliation of GST on stock transfers with
accounting records etc.
6 Understand the implications on product pricing, marketing and HR – The impact
of GST needs to be considered in the margins of various stakeholders in the distribution
chain to ensure that GST does not negatively impact product pricing and consequently
market share. This calls for a reassessment of exchange, discount and incentive schemes.
From a HR perspective, there may be a need to reconsider the indirect tax management
structure, training requirements of key indirect tax personnel depending upon the impact
assessment.
7 Assess if the IT systems are geared to address GST requirements effectively with
minimal manual workarounds – The Audit Committee should at the outset require
management to undertake necessary enhancements to IT systems so that the necessary
systemic alignments are in place to manage GST MIS requirements. Changes in the system
are likely to be required primarily on account of change in taxes/ tax rates, availability of
credits for input taxes on purchases including inter- state purchases and Import GST,
availability of cross credits for goods and services and GST on stock transfer.
Tax policies play an important role on the economy through their impact on both
efficiency and equity. A good tax system should keep in view issues of income
distribution and at the same time, also Endeavour to generate tax revenues to support
government expenditure on public services and infrastructure development. The
ongoing tax reforms on moving to a goods and services tax would impact the national
economy, International trade, firms and the consumers.
There has been a good deal of criticism as well as appraisal of the proposed Goods and
Services Tax regime.
By the above discussions one can reach following conclusion:-

• The macroeconomic impact of GST is significant in terms of growth effects, price

effects, current account effects and the effect on the budget balance.
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• In developing open economy with growing service sector, a change in the tax mix
from income to consumption-based taxes is likely to provide a fruitful source of
revenue.
• The proposed structure will simplify the procedure which will end up with equal
opportunity for all the markets and in other hand will leads reduced tax evasion.
It is preferred every economy must adopt GST at national level to make their
economy attractive for foreign investors. By implementing GST, the developing
economy like India can achieve sustainable and balanced development. Slowly,
India shall move to join the world wide standards in taxation, corporate laws and
managerial practices and be among the leaders in these fields. ceteris paribus
• It can also be concluded from the above discussion that GST will provide relief to
producers and consumers by providing wide and comprehensive coverage of input
tax credit set-off, service tax set off and subsuming the several taxes. It can be
further concluded that GST have a positive impact on various sectors and industry.
Implementation of a comprehensive GST across goods and services is expected, ceteris
paribus
to increase india’sGDPsomewherewithinarangeof0.9percentto
1.7 per cent. The corresponding changes in absolute values of GDP over 2008-09 is
expected to be between rs 42,789 crore and rs 83,899 crore, respectively. The
comparable dollar value increment is estimated to be between $9,461 million and
$18,550 million, respectively. The additional gain in GDP, originating from the GST
reform, would be earned during all years in future over and above the growth in GDP
which would have been achieved otherwise. The present value of the GST-reform
induced gains in GDP may be computed as the present value of additional income
stream based on some discount rate. We assume a discount rate as the long-term real
rate of interest at about 3 per cent. The present value of total gain in GDP has been
computed as between rs 1,469 thousand crore and 2,881 thousand crore. The
corresponding dollar values are $325 billion and $637 billion. Gains in exports are
expected to vary between 3.2 and
6.3 per cent with corresponding absolute value
range as rs 24,669 crore and rs 48,661 crore. The comparable dollar value increment is
estimated to be between $5,427 million and $10,704 million, respectively. Imports are
expected to gain somewhere between 2.4 and 4.7 per cent with corresponding absolute
values ranging between rs 31,173 crore and rs 61,501 crore. The comparable dollar
value increment is estimated to be between $6,871 million and $13,556 million,
respectively.
 59

The overall price level would go down. It is expected that the real returns to the factors
of production would go up. Our results show gains in real returns to land ranging
between 0.42 and 0.82 per cent. Wage rate gains vary between 0.68 and 1.33 per cent.
The real returns to capital would gain somewhere between 0.37 and 0.74 per cent. The
efficiency of energy resource use improves in the new equilibrium. The introduction of
GST would thus be environment friendly. Based on our computations, the revenue
neutral GST rate across goods and services is expected to be positioned somewhere in
the range of 6.2 per cent and 9.4 per cent, depending on various scenarios of sectoral
exemptions. In sum, implementation of a comprehensive GST in India is expected to
lead to efficient allocation of factors of production thus leading to gains in GDP and
exports. This would translate into enhanced economic welfare and returns to the factors
of production, viz. Land, labour and capital. As with any other modelling exercise, the
results of our exercise are subject to certain limitations. The general equilibrium model
that we have used is comparative static in nature. Aggregate supplies of labour, capital,
and agricultural land are assumed to remain fixed so as to abstract from
macroeconomic considerations. Given these limitations the results must not be read as
forecasts of variables but only as indicative directional changes. Implementation of a
comprehensive GST across goods and services is expected, maybe computed as The
present value of additional income stream based on some discount rate. We assume a
Discount rate as the long-term real rate of interest at about 3 per cent. The present
value of Total gain in GDP has been computed as between rs
1,469 thousand crore and 2,881 Thousand crore. The corresponding dollar values are
$325 billion and $637 billion. Gains in exports are expected to vary between 3.2and

6.3 per cent with corresponding Absolute value range as rs 24,669 crore and rs 48,661
crore. The comparable dollar value Increment is estimated to be between $5,427 million
and $10,704 million, respectively. Imports are expected to gain somewhere between 2.4
and 4.7 per cent with corresponding Absolute values ranging between rs 31,173 crore
and rs 61,501 crore. The comparable Dollar value increment is estimated to be between
$6,871 million and $13,556 million, Respectively.

The overall price level would Godown. It is expected that the real returns to the factors
of production would go up. Our Results show gains in real returns to land ranging
between 0.42 and 0.82 per cent. Wage rate Gains vary between 0.68 and 1.33 per cent.
The real returns to capital would gain somewhere Between 0.37 and 0.74 per cent. The
efficiency of energy resource use improves in the new equilibrium. The introduction of
GST would thus be environment friendly. Based on our computations, the revenue
neutral GST rate across goods and services is Expected to be positioned somewhere in
the range of 6.2 per cent and 9.4 per cent, depending On various scenarios of sect oral
exemptions. In sum, implementation of a comprehensive GST in India is expected to
lead to efficient Allocation of factors of production thus leading to gains in GDP and
exports. This would Translate into enhanced economic welfare and returns to the
 60

factors of production, viz. Land ,Labour and capital. As with any other exercise, the
results of our exercise are subject to certain Limitations. The general equilibrium model
that we have used is comparative static in nature. Aggregate supplies of labour, capital,
and agricultural land are assumed to remain fixed so as to Abstract from
macroeconomic considerations. Given these limitations the results must not be Read as
forecasts of variables but only as indicative directional changes.
The proposed Goods and Services Tax (GST) is said to replace all indirect taxes levied on
goods and services by the Government, both Central and States, on cities implemented.
The GST will consolidate all State economies. It will be one of the

biggest taxation reforms to take place in India once the Bill gets the official green signal.
The basic idea is to create a single, cooperative and undivided Indian market to make
the economy stronger and powerful. The GST will make a significant breakthrough
paving way for an all-inclusive indirect tax reform in the country.

In the year 2000, for the first time the idea of initiating the GST was made by the then
BJP Government under the leadership of Atal Behari Vajpayee. An empowered
committee was also formed for that, headed by Asim Das Gupta (the then Finance
Minister of the West Bengal Government). The committee was formed to design the
model of the GST and at the same time inspect the preparation of the IT department for
its rollout. In 2011, the previous United Progressive Alliance (UPA) Government also
introduced a Constitution Amendment Bill to facilitate the introduction of the GST in the
Lok Sabha but it was rejected by many States.

The GST is basically an indirect tax that brings most of the taxes imposed on most goods
and services, on manufacture, sale and consumption of goods and services, under a
single domain at the national level. In the present system, taxes are levied separately on
goods and services. The GST is a consolidated tax based on a uniform rate of tax fixed
for both goods and services and it is payable at the final point of consumption. At each
stage of sale or purchase in the supply chain, this tax is collected on value-added goods
and services, through a tax credit mechanism.

While RERA and GST will slowly change the way the real estate industry operates in
India, they have also thrown open a few aspects that need extensive deliberation. One
such issue is the liability of developers to provide for workmanship for structural defects
for a period of five years. Unlike in the past, developers will now have to create a back
to-back warranty with suppliers in case a challenge comes up. Starting from the contract
to execution and finally handing over, documentation has to be clearly spelled out. If a
developer wants to save himself from the pain of poor construction, he will have to
 61

keep tabs on agencies he conducts business with and the quality of materials he
procures. The end user would, of course, benefit from this improved diligence.
GST in India provides the long awaited generalization of the indirect tax structure. The
cash constituent of the building construction economy will reduce due to the execution
of GST in India. To avail ITC, contractors must purchase raw materials from GST-
registered vendors, resulting in better tax compliance. Under GST, the work contract is
considered as a service, and hence, the composition scheme is not available.
Contractor’s compliances and costs will increase as they will follow the standard
taxation system. GST confirmation on works contract as a service has brought clarity. But
the lack of details in the areas of input tax credit (ITC) and composition schemes might
lead to disputes. All in all, GST should impact the construction sector in a positive
manner, not only from a rate perspective but also on pricing of various products, albeit
in a run.
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5.3 RECOMMENDATIONS

The following are the suggestion made based on the results of the study.

Some suggestions for better administrative machinery to handle the implementation of

Goods and Services Tax Act in India are:
 Standardization of systems and procedures.

 Tax relief in case of branch transfer

 Well defined procedures in case of Job works

 Uniform dispute settlement machinery.

 Adequate training for both tax payers and taxon forcers.

 Re-organization of administrative machinery for GST implementation.

 Building information technology backbone – the single most important

initiative for GST implementation.
 Uniform Implementation of GST should be ensured across all states (unlike
the staggered implementation of VAT) as many issues might arise in case of
transactions between states who comply with GST and states who are not
complying with GST.
 63

BIBLOGRAPHY
Books:

• Adhana, D. K. (2015). Goods and services tax (GST): A panacea for Indian
economy. International Journal of Engineering & Management Research, 5 (4),
332 -338.
• Agogo Mawuli (2014): “Goods and Service Tax- An Appraisal” Paper presented
at the PNG Taxation Research and Review Symposium, Holiday
Inn,PortMoresby,29-30.
• Agogo Mawuli (2014) “ Goods and Service Tax --- An appraisal Paper presented
at the PNG Taxation Research and Review Symposium. Holiday inn port Moresby,
Pg No.29-30 ,April2014
• Chakraborty, P., & Rao, P. K. (2010, January 2). Goods and services tax in India:
An assessment of the base. Economic and Political Weekly, 45 (1), 49 -
54.
• Dr. R. Vasantha Gopal (2011), “GST in India: A Big Leap in the Indirect
Taxation System”, International Journal of Trade, Economics and Finance, Vol. 2,
No. 2,April2011.
• Dani, S. (2016). A Research Paper on an Impact of Goods and Service Tax (GST)
on Indian. Business and Economics Journal,1-2.

• Ehtisham Ahamad and Satya Poddar (2009), “Goods and Service Tax
Reforms and Intergovernmental Consideration in India”, “Asia Research
Center”,LSE-2009
• Fabian and Erik Hoelzl(2015) , Price , Perception and confirmation bias in the
context of a VAT increase, Journal of Economic Psychology 32 (1) volume 2 Pg
No. 131-- 141in20
• Garg, G. (2014). Basic concepts and features of goods and services tax in India.
International Journal of Scientific Research and Management (IJSRM), 2 (2), 542-
549
 64

• GST India (2015) “Economy and Policy”. Jaiprakash (2014), “Indirect Tax Reform
in India and a way ahead for GST”, International Journal of Computing and
Corporate Research, Vol 4,Issue1.

Internet :
This topic is completed with the help of some books as well as internet, some information
are taken from websites such as

1. Clear Tax

2. Goods and Services Tax Council

3. ET CFO

And other websites.

https://www.gstindia.com/about/

https://www.thequint.com/news/business/india-gst-most-complex-28-percentslab-second-
highest-rate-in-world-world-bank

https://www.bankbazaar.com/tax/gst.html

https://economictimes.indiatimes.com/gst

https://en.wikipedia.org/wiki/Goods_and_Services_Tax_(India)

https://gst.caknowledge.in/impact-gst-automobile-sector/

http://auto.economictimes.indiatimes.com/news/policy/benefitschallengesfor-auto-sector-
in-gst-bill/53541153
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QUESTIONNAIRE:
Title: “Impact of GST in INDIA”
Dear respondent,
I am conducting a survey on “Impact of GST in INDIA”. The information
collected from survey is purely academic purpose.
The information collected would be kept strictly confidential.
You may/may not give consent to disclose your identity. Kindly co-operate by
providing information of the following questions and oblige.

Questionnaire:

(1) What is range of your age?

a. 15-18
b. 19-24
c. 25-30
d. 31-35
e. 36-40

(2) Gender:
a. Male
b. Female
c. Other

(3) Annual Income

a. Below Rs 250000
b. 250001- 500000
c. 500001- 1000000
d. Above 1000000
 66

(4) Do you pay GST?

a. Yes
b. No

(5) What is your occupation?

(6) What is your business/industry type? ( If applicable )

(7) How did you first learn about GST?

a. News Media
b. Government Publications
c. Social Media
d. Friends/Family or Relatives

(8) Do you believe that GST has simplified the tax system in your country?

a. Strongly Disagree
b. Disagree
c. Neutral
d. Agree
e. Strongly Agree

(9) What improvements, if any, would you suggest for the current GST
system?

(10) In your opinion, has GST positively impacted the economy overall?

a. Strongly Agree
b. Strongly Disagree
c. Neutral
d. Agree
e. Disagree
 67

(11) How would you rate the support provided by the government for GST
compliance?

a. Very Poor
b. Poor
c. Neutral
d. Good
e. Very Good

(12) Do you think the current GST rates are fair?

a. Yes
b. No

(13) If you believe rates are unfair, then what changes in rates you prefer?

(14) Have you encountered any technical issues while using the GST
portal? (Yes, No)

If yes, please describe the issues.

(15) How does the GST compare to the previous tax system (e.g., VAT,
Service Tax)?
a. Much worse
b. Worse
c. About the same
d. Better
e. Much Better
68