Impact of GST on Entrepreneurs

By Registrationwala

6th September 2017

 

Goods and service tax will be beneficial for Entrepreneurs. This will be from the high threshold limit for registration and they need to pay tax only after registration under GST. GST bill will develop the structure economic integration of the Indian economy. GST is a form of tax that will help to curb the process of indirect taxation and make it easier and more effective. Under GST tax payers need to pay consolidated tax instead of the different taxes including State Value-Added Tax (VAT), Central Excise, Service Tax, Entry Tax and a few other indirect taxes.

GST Advantages for Entrepreneurs

  • Due to emerge in Indian market globally and locally the production and distribution will constantly increase. Since, it is a single taxation system that would encourage new businesses and entrepreneurs to engage in service and manufacturing sector.
  • Taxes are levied only on the final destination or on consumption of goods or services based on the value added (addition of value would be the taxable event).the activity may help in economic distortions in taxation amongst states and helps in the free movement of goods.
  • GST leads to reduction in discretion exercised by the assessing authority. It is a cogent tax form that will encourage better opportunities and lesser corruption.
  • Prices will go down due to this common will have a sense of relief. Decrease in price will lead increase in consumption and will make the manufacturing industry to produce more and thereby directly helping in an increase in GDP.
  • Lesser policies mean lesser complexity in the system. Making things more clear between states and identified tax norms
  • GST will also eliminate slowing of transportation system by making system more clear and quick.
  • Clarity of concept of tax between central government and state government.
  • Lesser maintenance and will boost the supply chain and will make things more organization.  
  • GST will boost start-up in India. Easing regulatory norms will not only benefit the new age businesses like impact on e-commerce but also helps to attract more foreign investments from global markets which in turn will create more employment opportunities.
  • Enhancement in the benefit of Input tax credit and will be allowed on the purchase of all goods and services that will be used for Business purposes. There will be raise in renegotiation of price with Suppliers of Goods and Services. This will nudge to pass on the benefit of reduced costs due to a free flow of credits.
  • Incorporate Safeguard Clause in Vendors' Contract .The ITC in GST administration is enabled subject to instalment of expense and right recording of return by the provider. In this manner, it is basic to suggest GSTIN. to every one of the merchants and have a repayment statement in the agreements with them to guarantee that if there should be an occurrence of default in the instalment of expense or off base recording of an arrival, the loss of ITC can be recovered. 

 

Impact of GST on Entrepreneurs

2017-09-06