Small business accounting software has been considered effective by businesses in India. We are also witnessing an exodus toward the GST accounting software due to the new tax reforms. Good online accounting software must be able to eliminate the difficulty experienced in integrating business accounts.
Impacts of GST on the Indian Economy
GST India accounting software has been considered by economic experts as a great Quickbooks alternative. There are several impacts of the Goods and Sales Tax on the Indian economy and they are as follows;
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E-Commerce and Online Marketplaces
A tax collected at source (TCS) will be collected by online stores like Amazon and Flipkart at a fixed rate of 1% and this amount will be paid to sellers on their sites. This will make online shopping costlier.
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Increased production and Reduction of Tax Burden
The previous structure of taxation galvanized with numerous tax clauses, obstructed producers from manufacturing at their optimum capability, and stifled growth. GST efficiently takes care of this challenge by providing tax credits to the producers.
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Elimination of undue storage expenses
A number of tax barriers like toll plazas and check posts often result in the wastage of unpreserved and perishable items in transit. This resulted in an increase in costs due to the increasing need of buffer stock and the cost of storage. A solitary taxation system like GST expels the disadvantages of this roadblock.
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Growth in Real estate
Due to the inputs credit benefits that most builders stand to get under the new tax structure, raw materials will be available at a reduced price. Major players in real estate like Quikr and Proptiger are looking to pass this cost advantage to property buyers.
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Transparency and accountability
The GST promises more transparency and accountability in the system because the taxpayers will know the exact amount of taxes levied on them and on what bases are they being charged.
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Increased government revenues
GST serves as an alternative source of income for the government through a means of extending the tax base.
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Credit facilities
GST provides credit for the taxes paid by manufacturers in the production chain. This will serve as an encouragement for producers to purchase raw materials from different certified dealers. The potential effect of this is that more suppliers and vendors will be enticed and brought in under the scope of affordable taxation.
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Elimination of export custom duties
GST directly affects the Indian economy by expelling the custom duties applicable to exports. The country’s competitiveness in the global markets will rise based on the lower cost of transactions.
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Long-run economic benefits
The merger of Central and State taxes into a single tax expects GST to significantly improve the Indian economy by eliminating the stress of double taxation and making it easy for industries.
Final Words
Despite the economic challenges faced by even the world’s biggest economies, India has thrown the hat in the ring by embarking on a couple of strategic plans to fortify and bolster its economy. The Goods and Service Tax (GST) is one of the undertakings of the Indian economy that is supposed to stimulate the much desired economic growth by transforming the previous indirect taxation toward the uninhibited flow of goods and services.
