The Government of India has appointed Sushil Modi, a senior member of BJP as the head of the panel on implementing the Goods and Services Tax(GST) which aims to improve India’s meandering tax regime. The GST regime is about to come in force on 1st April, 2012. The GST is intended to bring uniformity in the goods and services market as to the provision of charging of tax.
This move is aimed to bring together BJP with the Congress on this issue and remove the difference on the issue. The Congress government has failed to make headway on the GST due to the opposition of several Indian States, who fear that they will lose their fiscal autonomy with the enforcement of this tax regime.
The main motive for the advocacy of GST is to cut business costs and boost government revenues. At present, a manufacturer who wishes to move the goods from one state to another has to struggle with a number of different types of taxes which causes hardship to the manufacturer and in turn hampers the trade.
Once enforced, GST will facilitate to get away from a maze of local taxes that can be raised or lowered at will of the states, making life harder for manufacturer/ firms.
