Unlocking the Benefits: Finance Minister Nirmala Sitharaman Reveals How GST Empowers Everyday Citizen

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Empowering the Underprivileged: Nirmala Sitharaman Affirms GST’s Positive Impact on the Poor

          Image Source- Google| Image By-Oneindia

Giving information about the benefits of GST on Saturday, Finance Minister Nirmala Sitharaman said that the Goods and Services Tax has given relief to the common people. The tax reform introduced in 2017 has brought down the cost of goods, reduced prices on goods and brought relief to the people.

Speaking at an event organized on the occasion of the sixth anniversary of GST, Nirmala Sitharaman said that on many common use items, the tax rate under GST is much lower than before GST.

Reduced tax on these items

The Finance Minister said that items like milk, tea, milk powder, sugar, edible vegetable oils, spices and footwear costing up to Rs 500, irrespective of the relevant entity, would attract earlier tax of 6 to 10 per cent under GST. In comparison, 5 per cent tax is levied. Sitharaman said that GST on items like hair oil, toothpaste, soap, perfume and detergent was 28 per cent, which has been reduced to 18 per cent.

Only 12% GST on these items

The Finance Minister also informed that before GST, the average tax on general use electrical items like mixer, grinder, refrigerator, vacuum cleaner and television (27 inch) and washing machine was 31.5 per cent and now it has come down to 12 per cent. Nirmala Sitharaman told that these are no longer a luxury item, but are used for household chores.

Increase in state coffers

Nirmala Sitaraman also told tat after the implementation of Gdp, there’s good increase in revenue of state governments. He said that the revenue of almost all the states has increased. The central government has also collected more amount than GST.

                      Image Source- Google| Image ByIndiafilings

Advantages and Disadvantages of GST: Analysis

At present, indirect taxes like sales tax, excise tax, customs duty, entertainment fee, octroi tax and VAT are imposed in India, but from July 1, only one tax “Goods and Services Tax” will be imposed in place of all these indirect taxes. After doing this, India will become the 166th country in the world to implement GST. For your information, let me tell you that GST is also applicable in Pakistan.

It is known that at present indirect taxes like sales tax, excise tax, customs duty, entertainment fee, octroi tax and VAT are levied in India, but from July 1, only one tax “Goods and Services Tax” will be imposed in place of all these indirect taxes. . After doing this we will become 166th member in the list of 165 countries where GST is applicable. For your information, let me tell you that GST is also applicable in Pakistan. In this article, we have told about some advantages and disadvantages related to “Goods and Services Tax”.

Advantages of GST

1. The tax system in India will be simple and will get rid of the system of ‘tax on tax’.

2. According to a report by the National Council of Applied Research, there is a possibility of an increase of 2 to 3 percent in India’s gross domestic product due to the implementation of GST.

3. In the present system, if a company or factory manufactures its products in one state and sells them in another state, then it has to pay many types of taxes to both the states, which increases the price of the product, but with the implementation of GST, only one tax will be levied, which will The price of products will decrease.

4. After the implementation of GST, only one tax will have to be paid to buy any goods in the whole country, due to which the price of any goods will remain the same in the whole country. In the current system, every state imposes different taxes on the purchase of vehicles, as compared to Delhi, the tax is less in Haryana, due to which people living in Delhi buy vehicles from Haryana so that they have to pay less tax, but after the implementation of GST, the entire tax is paid. A uniform price will have to be paid for the purchase of vehicles in the country.

5. After the implementation of GST, the possibility of tax evasion by the officials of the tax department will also reduce.

Disadvantages of GST

1. About 60% of India’s ‘Gross Domestic Product’ comes from the service sector. At present, service tax is levied at the rate of 14.5% in India, which will increase to 18% after the implementation of GST.

For example, now you have to pay Rs 14.50 tax on mobile bill of Rs 100, which will increase to Rs 18 after July 1, 2017.

2. Due to the implementation of GST, the income of some states will definitely decrease, but the central government will compensate the loss of any state only for 5 years.

3. The effective tax rate in the banking and financial sector is 14 percent. Till now this tax is applicable only on transactions. There is no tax on the interest. But after the implementation of GST, the tax on this sector will increase from 18 to 20 percent. Means processing fees, fees on debit / credit cards, charges on insurance premium will increase

4. It is known that the main source of income of many states is tax income from petrol and diesel and liquor. Recently, these items have been kept out of GST, but when these items will come under the purview of GST, there will definitely be a big reduction in the income of the states and such states will turn to the central government to meet the shortage of money. Will have to watch and the situation will worsen when different parties will be in power in the center and the concerned state.

“Article Credit: Vikas Yadav”


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