Goods & Services Tax: Indirect Tax Reform in India

Abstract

This paper brings out not only the timeline of Goods and Services Tax in India, but also the possible circumstances that led to such a reform in indirect taxation. With the introduction of goods and services tax (GST), a variety of indirect taxes will be subsumed and the tax regime will be largely simplified. As such, light is also thrown on how GST differs from the existing indirect taxes and its advantages over them in terms of ease in collection and how it brings out the underground activities that are not taxed by the existing taxes. This paper also focuses on the potential consequences and the hurdles that India may face due to Goods & Services Tax. Since the concept of fiscal federalism is nestled by the GST, my paper also explains how taxes will be distributed between the centre and the state. The impact on manufacturer and consumer states is also investigated in this paper.