Despite the continued wrangling and the adoption of diametrically opposite views by different political camps, all eyes are now on the boons and banes of the long-stalled Goods and Services Tax (GST) Constitutional Amendment bill. The bill happens to be the biggest tax reform in the country since Independence. GST or the single unified tax levied on goods and services will make the tax structure simpler thereby bringing about greater compliance and a reduction in cascading. While the GST looks promising in streamlining the tax regime, doing away with arbitrary exemptions, and making the country more tax-compliant, it also promises to be manufacturer and consumer friendly to quiet an extent.
WHAT WILL GET CHEAPER?
- Auto: Smart Cars, Two wheelers, Entry-Level Cars
- Electronics: Fans, water-heaters, coolers
- Real Estate: Construction components, building materials
- Movies: Entertainment tax to come down
WHAT WILL GET STEEPER?
- Services: Phone bills, restaurants, air tickets
- Commercial Vehicles: Trucks, tempos
- Luxury Items: Branded jewellery, clothes, textiles
- Insurance: Premiums likely to increase
WHAT WILL THEY EXEMPT?
- Essential Food: Bread, tea etc?
- Medical Equipment
- Green power sources, CFL bulbs
NO SPECIAL INCENTIVES?
- No clarity regarding Special Economic Zones
- No clarity on existing tax incentives
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