House of Parliament is one place, where anything is possible. We have seen brutal verbal conversations during the parliament segments. Long back Atal Bihari Vajpayee, who was the former Prime Minister of the India proposed a plan in the Parliment, which was opposed by several other members.
The current Prime Minister has suggested the same thing called “GST,” and the full form is Good Service Tax, which happens to make a significant change in the Indian economy.
How does this will impact Indian economy? Does it come with any benefits for the consumers? We are going explain everything in detail in simple words.
What is GST – Goods Service Tax?
Every Indian pays tax in one or any other form. Let’s assume that you have purchased a pair of shoes then you will be charged with Taxes about 12%. When you buy a Car, House, Flat, Furniture, Restaurant, and more then you will be charged 12%, which is the first tax.
Not many people know that every common man combined pays an average tax of 35% in a month to the Central government.
Types of Taxes (Indirect)
- Service Tax,
- Luxury Tax,
- Goods Tax,
- Vat (Value added tax),
- Customs duty,
- Excise Tax,
- Securities Transaction Tax (STT),
- Entertainment Tax,
- And Stamp duty.
Are you shocked? Yes, you are paying a total of 35% Tax each month, which is an insane amount of money.
Before GST & After GST?
When you go to a restaurant to have a Dinner with the bill of Rs.3000, then the taxes are,
- Food bill: Rs.3000,
- Vat: 5%, (Random Tax),
- Luxury: 5% (Random Tax),
- Service Tax: 5% (Random Tax),
- Indirect Tax: 12%.
Total Tax: 27%.
- Good Bill: Rs.3000
- GST: 18%
Total Tax: 27%.
As you can see, now you don’t have to pay more tax to the Government.
GST: Goods service tax is all about removing all above TAX code, and charge every Indian citizen with one tax code called “GST,” which will eliminate all other taxes.
GST Will Affect Gold Prices, Hikes is Expected
Let’s get to the main point, if the Government started to provide massive tax cuts, then Country Treasure will run of jewels within no time, but that’s not going to happen. The GST is all about benefiting the poor people and helping the Lower class and Middle class.
The Government is now targeting products and services, which are affordable to those who have a decent income. Old Tax format “Value-added Tax 1%, Excise duty tax 1% = 2%” but now Good service tax will now get costlier by 1%.