24th April 2017
Goods and Services Tax is one biggest Tax reform in Indian economy. It is set to bring forth unprecedented transformation. There are lots things that are going to change and industry has to be ready according to change in tax reforms. Since there are a lot of conjecture taking place around our markets. There is an expectation that the GST will prove to be a strong enabler for the Start-up ecosystem. Since GST will provide a streamlined and effective tax collection process by removing the biggest bane of the manufacturing industry.
Following are the points of GST
GST will consolidate wide scope of indirect taxes like VAT, Service Tax, Central Excise, Octroi or Entry Tax into one unified tax.
The Indian Start-up community will better gain after implementation of GST. GST will not only gain the industry into manufacturing segment but also another form. Following are ways in which Start-up Community will take it easy
Business can become easy going
GST will include all the forms of indirect tax there it will eradicate VAT, Sales Tax etc. In present scenario, every new business needs to follow multiple doors of the Sales Tax department for their VAT registration. Businesses operation that has to take place in multiple states will persevere their way through a host of different procedures, guidelines, and fee structures.
Startup Wave flowing to tier-II and beyond
GST will make India one seamless consolidated market. Due to it, the big league manufacturers would no longer need to limit sourcing their ancillary products from their local markets, by limiting various state taxes. There will be some merit reaching out to the millions of micro and small enterprises thriving in tier 2 and beyond cities which have perfected their ability to keep the prices of their commodities at modest levels by managing at very low cost outlays. This will provide the much-needed impetus to the ‘Make in India’ initiative in remote cities, and these cities will see an upsurge in the manufacturing, Startups integrating Bharat with India.
GST will Boost Digital India
GST will need a digital solution to manage the books of account. Due to this calculation of tax under GST will be challenging task will disturb time management and require more manpower. It is an ocean of opportunity to cash on by providing customized solutions to MSMEs, who have resisted the move to digitization due to the heavy initial investment. This will deploy technology to enable computation of GST with the micro and small enterprises. This will imbibe the GST policy. There is expectation of increase in process-level efficiencies, cost reductions and increased growth prospects.
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