On July 1, 2024, the Goods and Services Tax (GST) marked its seventh anniversary. Introduced in 2017, GST revolutionised India’s tax system by unifying multiple taxes into a single indirect tax structure, eliminating the cascading effect, and enhancing economic integration.
Achievements of GST
Implemented on July 1, 2017, the Goods and Services Tax (GST) consolidated 17 taxes and 13 cesses into a streamlined 5-tier system, simplifying the tax framework.
Some key milestones and achievements of GST are as follows:
- The total number of registered taxpayers has increased from 6.5 million in 2017 to 14.6 million in 2024, enhancing the tax net.
- Before GST, there were a total of 495 submissions, including different forms and challans, which have been reduced to 12.
- Indirect taxes on essential goods and services have significantly decreased.
- The elimination of interstate levies and taxes with the introduction of GST has led to the free movement of goods across states, significantly improving transportation time and reducing the cost of doing business.
The steady rise in average monthly collections shows broad support for GST.
Technology as a Key Driver
The success of GST is largely attributed to how effectively it has incorporated technology, allowing streamlined services for businesses while helping authorities crack down on tax evasion.
The GST Network (GSTN), the backbone of the entire GST ecosystem, is a digital one-stop platform offering all services such as registration, tax payments, and compliance for businesses. The absence of human intervention has worked wonders for businesses, particularly MSMEs, as the automated system provides speedy resolution of grievances and eliminates corrupt practices.
Statistical Highlights of GST Since Inception
- GST has spurred economic growth and enhanced government tax revenues. The total GST collection for 2017-18 was Rs 7.4 trillion, which increased to Rs 20.2 trillion in 2023-24.
- Since FY 2022, GST has seen a strong double-digit growth rate in total collections.
- Moreover, as expected, states like Maharashtra, Haryana, Karnataka, and Telangana have recorded the highest per capita GST collections.
*Covid Affected Year
GST collections have maintained a healthy double-digit growth rate for the last three financial years.
What’s Next?
It is crucial to expand the tax base by including all commodities such as petroleum products, electricity, land, and alcohol under GST. Additionally, the numerous exemptions should be reviewed to minimise cascading effects. This will aid in rate rationalisation by reducing the number of tax rates for goods and services, thereby minimising litigations.
That’s it for today. We hope you’ve found this article informative. Remember to spread the word among your friends. Until we meet again, stay curious!
*This article is for informational purposes only. This is not investment advice.
*Disclaimer: Teji Mandi Disclaimer
