How will the GST impact Indian capital markets?

Not many radical economic changes have impacted the Indian Economy as much as the Good and Services tax(GST) since 1947. and it plays an important role in the economy of India. GST is levied on the manufacture, sale and also the expenditure of goods and services

 The chief purpose of GST is to unify indirect taxes and create a common market. The Finance Minister of the country, Arun Jaitley says that the GST bill will revolutionize the economy of India and helps in the economic integration of India. Thus the GST also is a way to make the cumbersome tax process uniform, which is levied on goods and services across the country.

Certain Facts of GST which you should know about

Currently, the tax scenario is like this, there are multiple indirect taxes which are levied on goods and services which are a deterrent to the growth of India’s economy. 

There is not one but numerous taxes in the forms of CST, Entry tax, VAT, Excise duty, Entertainment tax, Customs duty and Stamp duty and any other have divided the Indian market. This scenario means that introduction of GST will result in economic growth. 

GST is sure to impact positively on the Indian economy. Some of the sectors of the Indian economy are more impacted upon in comparison to another sector under GST.

After the GST implementation, it has removed all the indirect taxes and formed a single common market which results in an efficiency of supply chain and an economy of scale in production It can also give leeway to improved trade and commerce.

GST will also do away with the rapid effect of taxes rooted in the cost of production of products or services and will provide the required credit throughout the value sequence. 

This will particularly minimize the expense of natural products and will raise the importance of the ‘Make in India’. The long value sequence can be found in basic products to final consumption stage with functions distributed in different states which include the FMCG, consumer resilient, pharmaceutical, vehicles and also technological innovation products which are the ones which will bear the major brunt of the GST application. 

GST will help the business to flourish in India. The expense of tax conformity and deal price will be substantially resolved with the transformation of current several taxations into single GST. So you get a tax program which is stable, clear and definitely foreseeable, it will draw both local and foreign investors in droves to India and this also means lucrative job opportunities.

Goods and services tax (GST) has started being implemented from July 1.

There are certain expectations from this tax reform that it will boost the Indian economy and a major shift will be seen from unorganized to organized sector.

However, you would expect to experience near term hiccups for the next one or two-quarters.

According to a few market experts, job creations may prove to be a problem.

Whatever the consequence the GST is said to create a major economic transformation, the effect of which will spread far and wide.