The Union government announced that the Goods and Services Tax (GST) has significantly benefited the common man by decreasing tax incidence, reducing compliance burden and logistics cost for trade and industry, and increasing revenues for both the Central and state governments.
Expansion of GST
In the Union Budget 2024-25, it was indicated that GST would be expanded to cover the remaining sectors. Finance Minister Nirmala Sitharaman highlighted the success of GST and emphasized the government’s commitment to simplifying and rationalizing the tax structure to maximize its benefits.
Digitization of Taxpayer Services
Significant progress has been made in digitizing major taxpayer services under GST, as well as most services under Customs and Income Tax.
GST Collection Growth
India’s gross GST collection reached Rs 1.74 lakh crore in June this year, marking a 7.7% increase compared to the same month last year. This brings the total GST collection for the first quarter of the current financial year to Rs 5.57 lakh crore. April 2023 saw a record high collection of Rs 1.87 lakh crore.
Impact on Economic Growth
Experts attribute the GST reforms to easing compliance and reducing tax burdens, which have been crucial in driving economic growth. The proposed rationalization of the tax structure and changes in the new tax regime, such as the increased standard deduction, are expected to benefit the salaried class and boost disposable income, positively impacting housing demand.
Benefits to Households
The GST regime, which has been in place for seven years, has resulted in reduced taxes on household appliances and mobile phones, bringing relief and happiness to every home.
Increase in Taxpayer Base
The GST taxpayer base grew to 1.46 crore in April 2024 from 1.05 crore in April 2018. Additionally, the compliance burden was reduced for small taxpayers, with the GST Council recommending the waiver of the annual return filing requirement for taxpayers with an aggregate annual turnover of up to Rs 2 crore in fiscal 2023-24.
Multiple Choice Questions (MCQs):
- What has been one of the primary benefits of GST according to the Union government?
- A) Increased tax incidence on the common man
- B) Increased compliance burden
- C) Decreased logistics cost for trade and industry
- D) Decreased revenues of the Central and state governments
- What did the Union Budget 2024-25 indicate about the GST?
- A) It will be reduced for all sectors
- B) It will remain the same
- C) It will be expanded to the remaining sectors
- D) It will be abolished
- By how much did India’s gross GST collection increase in June this year compared to the same month last year?
- A) 5.5%
- B) 6.3%
- C) 7.7%
- D) 8.9%
- What was the record high GST collection in April 2023?
- A) Rs 1.74 lakh crore
- B) Rs 1.80 lakh crore
- C) Rs 1.87 lakh crore
- D) Rs 1.90 lakh crore
- What recommendation did the GST Council make for small taxpayers for fiscal 2023-24?
- A) Increase the annual return filing requirement
- B) Maintain the current annual return filing requirement
- C) Waive the annual return filing requirement for taxpayers with an aggregate annual turnover of up to Rs 2 crore
- D) Abolish the annual return filing requirement