Question

Importance of GST in Indian economy

Answer 1

GST bill covers the Goods and Services Tax and shall be the biggest indirect tax reformproviding a uniform and simplified way of Indirect taxation in India.Once introduced it will replace a number of other taxes like VAT,CST,Service tax,CAD,SAD, Excise,Entry tax,purchase tax etc.

GST or Goods and Services Tax - A new law,a new tax will bring with it new challenges to face.

The basic idea for introducing GST is converting India into a single market.This might have a positive impact on GDP of India and help to boost the Indian economy.

Dual system of GST includes :

SGST or State GST - collected by State Government.CGST or Central GST - collected by Central Government.IGST or Integrated GST - collected by Central Government.

Main Advantages of GST :

Life gets simpler 
GST will replace 17 indirect tax levies and compliance costs will fall.A unified tax system removing a bundle of indirect taxes.It will replace other taxes like VAT,CST,Service tax,CAD,SAD, Excise,Entry tax,purchase tax etc. It removes cascading effect of taxes.Revenue will get a boost 
- Evasion set to drop - Input tax credit will encourage suppliers to pay taxes - States and Centre will have dual oversight - The number of tax-exempt goods will decline.will increase the number of tax payers and will improve transparency in business.A unified tax regime will lead to less corruption which will indirectly affect the common man.A common market 
It's currently fragmented along state lines, pushing costs up 20-30%Logistics, inventory costs will fall 
Checks at state borders slow movement of trucks. In India, they travel 280 km a day?? compared with 800 km in the USInvestment boost 
For many capital goods, input tax credit is not available. Full input tax credit under GST will mean a 12-14% drop in the cost of capital goods. Expected: A 6% rise in capital goods investment, 2% overall.Make in India 
 Manufacturing will get more competitive as GST addresses cascading of tax, inter-state tax, high logistics costs and fragmented market b) Increased protection from imports as GST provides for appropriate countervailing duty.

Answer 2

The GST is governed by a GST Council and its Chairman is the Finance Minister of India. Under GST, goods and services are taxed at the following rates, 0%, 5%, 12% ,18% and 28%. ... GST replaced a slew of indirect taxes with a unified tax and is therefore set to dramatically reshape the country's 2 trillion dollar economy.