New Parliamentary report on plans for Indian GST
- Jul 31, 2013 | Richard Asquith
Plans to introduce a Goods and Service Tax to replace Indian VAT, Service Tax and CENVAT took a step forward last week with the Parliamentary Standing Committee produced a report on the implementation plans.
GST to bring improvements over Indian VAT
The current Indian VAT regime is highly complex, with many conflicts and double taxation between the Central State VAT and Indian Service Taxes. This leads to a high administration burden on businesses, and restricts intra-State trade. The proposals for GST, proposed in 2010, aim to eliminate this, and introduce a blended State and Central consumption tax regime – similar to the Canadian GST and Australian GST regimes. It also should raise the proportion of indirect / transaction taxes as a share of GDP towards OECD standards. Read more about Indian GST implementation.
States still oppose Indian GST
At least two Indian states still oppose the introduction of GST and the split between the States and Centre, which has led to it being delayed many times in the past two years. This is a similar problem to that experienced with Australia GST where the share between the States is still being reviewed after over 10 years of living with GST.