Three years of GST: taxpayer increased and increased complexities didn’t increase collection
Three years of GST: taxpayer increased and increased complexities didn’t increase collection
Three years have passed since GST came into force on Wednesday as one tax regime. But it had been not fully successful in its objectives. While traders are troubled by its complexity, the govt is additionally disappointed at the shortage of expected collection.
On July 1, 2017, while implementing the GST law, including 17 sorts of tax, the govt termed it as second independence.
It was expected that this is able to stop evasion, increase the number of taxpayers and therefore the economy would also increase with the autumn in inflation. the govt had also hoped that there would be a GST collection of 1.5 lakh crore monthly, but thus far there has not been any continuity within the GST collection of 1 lakh crore.
Earlier, consumers had to pay VAT of 14.5%, excise duty 12.5%, and a total tax of 31%. Also, many returns had to be filed and lots of departments had to travel through the scrutiny process. Now all this has been got obviate.
The process couldn’t be simplified
Through the GST, the govt wanted to form the collection process easier but the five rates (0.25, 5, 12, 18, 28 percent) in it complicated the classification of products/services. Returns like monthly, quarterly, and yearly made the method more complicated.
Traders say that despite the many amendments in 40 meetings of the GST Council thus far, the complexity is increasing. aside from this, the expectations of accelerating 2 percent GDP have also suffered a setback. the expansion rate in 2019-20 was rock bottom in 11 years. It was 7.2 percent in 2017-18, which was 6.8 percent in 2018-19 and 4.2 percent last year.
Tax evasion stopped, new taxpayers joined
After GST, crores of latest businessmen got registered across the country and therefore the number of taxpayers also increased. However, this growth on the collection front was limited only in figures. But activities like evasion are curbed. Businessmen now fill tax returns digitally and customers need to give GST details within the bill paid. This increased transparency and reduced evasion.