IMPACT OF GOODS & SERVICE TAX ON CONSUMERS

A PROJECT SUBMITTED TO

UNIVERSITY OF MUMBAI FOR PARTIAL COMPLETION OF THE DEGREE OF

BACHELOR OF MANAGEMENT STUDIES

UNDER THE FACULTY OF COMMERCE

2022-2023

SABALE SANKET KISHOR

ROLL NO. - 220702

UNDER THE GUIDANCE OF

PROF. SAURAV SALINKHE

S.D.T.KALANI MEMORIAL TRUST’S

COLLEGE OF ARTS , SCIENCE AND COMMERCE
A-BLOCK ROAD,NR SHAHAD, ULHASNAGAR

1
 IMPACT OF GOODS & SERVICE TAX ON CONSUMERS

A PROJECT SUBMITTED TO

UNIVERSITY OF MUMBAI FOR PARTIAL COMPLETION OF THE DEGREE OF

BACHELOR OF MANAGEMENT STUDIES

UNDER THE FACULTY OF COMMERCE

2022-2023

SABALE SANKET KISHOR

ROLL NO. - 220702

UNDER THE GUIDANCE OF

PROF. SAURAV SALUNKHE

S.D.T.KALANI MEMORIAL TRUST’S

COLLEGE OF ARTS , SCIENCE AND COMMERCE
A-BLOCK ROAD,NR SHAHAD, ULHASNAGAR

2
 Certificate

This is to certify that Mr. SABALE SANKET KISHOR

has worked and duly completed his Project Work for the degree of Bachelor of
Management Studies under the Faculty of Commerce in the subject of GST and
his project is entitled, IMPACT OF GOODS AND SERVICE TAX ON
CONSUMERS under my supervision.

I further certify that the entire work has been done by the learner under my
guidance and that no part of it has been submitted previously for any Degree or
Diploma of any University.

It is his own work and facts reported by his personal findings and investigations.

Seal of Name and Signature of

the Guiding Teacher
college

Date of submission:

3
 Declaration by learner

I the undersigned Mr. SABALE SANKET KISHOR here by. declare that the
work embodied in this project work titled IMPACT OF GOODS AND SERVICE
TAX ON CONSUMERS forms my own contribution to the research work carried
out under the guidance of SAURAV SALUNKHE is a result of my own research
work and has not been previously submitted to any other University for any
other Diploma to this or any other University.

Wherever reference has been made to previous works of others, it has been
clearly indicated as such and included in the bibliography.

I, here by further declare that all information of this document has been
obtained and presented in accordance with academic rules and ethical conduct.

Name and Signature of

the learner

Certified by

Name and Signature of the Guiding Teacher

4
 Acknowledgment

To list who all have helped me is difficult because they are so numerous and the
depth is so enormous.

I would like to acknowledge the following as being idealistic channels and fresh
dimensions in the completion of this project.

I take this opportunity to thank the UNIVERSITY OF MUMBAI for giving me

chance to do this project.

I would like to thank my Principal, DR. AMOL KADAM for providing the
necessary facilities required for completion of this project.

I take this opportunity to thank our Coordinator PROF. DISHA SUNDRANI , for
her moral support and guidance.

I would also like to express my sincere gratitude towards my project guide

SAURAV SALUNKHE whose guidance and care made the project successful.

I would like to thank my College Library, for having provided various reference
books and magazines related to my project.

Lastly, I would like to thank each and every person who directly or indirectly
helped me in the completion of the project especially my Parents and Peers
who supported me throughout my project.

5
 INDEX
Sr No. Particulars Page No.

1. Chapter 1:Introduction 8-38

1.1 What is GST

1.2 GST History
1.3 When did GST start
1.4 History of GST in India.
1.5 How GST Works in India
1.6 Implementation
1.7 Tax Structure before GST
1.8 Who Should Register for GST
1.9 Know the GSTIN- GST Identification Number
1.10 Decision taken be GST Council
1.11 Goods and Services Tax Network
1.12 Key features of the GST regime
1.13 Benefits of GST Implementation
1.14 Types of GST
1.15 Benefits of GST
1.16 Slab rates for different categories of goods and
services .
1.17 Services under different GST Rates
1.18 List of items under the 12% GST slab rate
1.19 List of items under the 18% GST slab rate
1.20 GST- exempted goods and services
1.21 Advantages of the Common Man
1.22 Disadvantages of GST
1.23 Negative Impact of GST on Common Man

2. Chapter 2:Objective of study 39

2.1 Objectives Of the Study

3. 40-42
Chapter 3: Review of Literatures
3.1 Literature Review

6
4. Chapter 4: Research Methodology 43-44

4.1 Hypothesis
4.2 Scope of the study
4.3 Types of Research
4.4 Sample Size
4.5 Total Sample size

5. Chapter 5: Data Analysis and lnterpretation 45-62

5.1 Table 1 to 17

6. Chapter 6: Limitation of study 63

6.1 Limitation of the Study

7. Chapter 7: Conclusion 64

7.1 CONCLUSION

8. Chapter 8: Reference & Bibliography 65

8.1 REFERENCES

9. Chapter 9: Questionnaire 66-70

9.1 QUESTIONAIR

7
 CHAPTER 1: INTRODUCTION

Introduction:

Goods and Sales Tax is an indirect tax system that replaced the old cumbersome
indirect tax system of India. Late ShriAtalBihari Vajpayee, the 15th Prime
Minister of India, introduced the GST system in the year 2000 and set up a
committee to design a GST model for the country. However, it was finally
introduced in 2016 through the Constitutional (One Hundred and First
Amendment) Act, 2016.

GST is acknowledged worldwide and is one of the central government’s most

significant projects. The objective of introducing GST was to create a single
national market with a single tax system to reduce unnecessary burden on the
taxpayers.

It has now been in effect for three years, and evaluation of this tax system is vital
to find out whether this tax system is more beneficial than the earlier tax system
for the common man of the country.

1.1 What is GST?

Goods and Sales Tax is a unified tax on every value-added, starting from
manufacturing to the consumption of Goods and/or Services. It is a destination-
based tax system and is also known as consumption tax because, under GST, tax
is levied where the Goods or Services are consumed.

In India, a dual model of GST has been adopted i.e. where tax is levied
concurrently by the central and the state government. The GST system comprises
of Central Goods and Services Tax (CGST), State Goods and Services Tax
(SGST), Union Territory Goods and Services Tax (UGST). For inter-state
transactions (where the location of the supplier and the place of supply in
different states), integrated Goods and Services Tax (IGST) is levied.

Initially, there was a four-tiered GST rate: 5%, 12%, 18% and 28%. However,
currently, the rates have been increased to 7 with 0%, 0.25%, and 3% added to
the list.

1.2 GST History

8
 The implementation of the Goods and Services Tax (GST) in India was a
historical move, as it marked a significant indirect tax reform in the country. The
amalgamation of a large number of taxes (levied at a central and state level) into
a single tax is
expected to have big advantages.One of the most important benefit of the move is
the mitigation of double taxation or the elimination of the cascading effect of
taxation. The initiative is now paving the way for a common national market.
Indian goods are also expected to be more competitive in international and
domestic markets post GST implementation.
From the viewpoint of the consumer, there would be a marked reduction in the
overall tax burden that is currently in the range of 25% to 30%. The GST, due to
its self-policing and transparent nature, is also easier to administer on an overall
scale.

1.3 When did GST start?

Several countries have already established the Goods and Services Tax. In
Australia, the system was introduced in 2000 to replace the Federal Wholesale
Tax. GST was implemented in New Zealand in 1986. A hidden Manufacturer’s
Sales Tax was replaced by GST in Canada, in the year 1991. In Singapore, GST
was implemented in 1994. GST is a value-added tax in Malaysia that came into
effect in 2015.

1.4 History of GST in India.

 2000: In India, the idea of adopting GST was first suggested by the AtalBihari
Vajpayee Government in 2000. The state finance ministers formed an
Empowered Committee (EC) to create a structure for GST, based on their
experience in designing State VAT. Representatives from the Centre and states
were requested to examine various aspects of the GST proposal and create
reports on the thresholds, exemptions, taxation of inter-state supplies, and
taxation of services. The committee was headed by AsimDasgupta, the finance
minister of West Bengal. Dasgupta chaired the committee till 2011.

 2004: A task force that was headed by Vijay L. Kelkar the advisor to the finance
ministry, indicated that the existing tax structure had many issues that would be
mitigated by the GST system.

 February 2005: The finance minister, P. Chidambaram, said that the medium-to-
long term goal of the government was to implement a uniform GST structure
across the country, covering the whole production-distribution chain. This was
discussed in the budget session for the financial year 2005-06.

9
 February 2006: The finance minister set 1 April 2010 as the GST introduction
date.

 November 2006: ParthasarthyShome, the advisor to P. Chidambaram, mentioned

that states will have to prepare and make reforms for the upcoming GST regime.

 February 2007: The 1 April 2010 deadline for GST implementation was retained
in the union budget for 2007-08.
 February 2008: At the union budget session for 2008-09, the finance minister
confirmed that considerable progress was being made in the preparation of the
roadmap for GST. The targeted timeline for the implementation was confirmed to
be 1 April 2010.

 July 2009: Pranab Mukherjee, the new finance minister of India, announced the
basic skeleton of the GST system. The 1 April 2010 deadline was being followed
then as well.

 November 2009: The EC that was headed by AsimDasgupta put forth the First
Discussion Paper (FDP) , describing the proposed GST regime. The paper was
expected to start a debate that would generate further inputs from stakeholders.

 February 2010: The government introduced the mission-mode project that laid
the foundation for GST. This project, with a budgetary outlay of Rs.1,133crore,
computerised commercial taxes in states. Following this, the implementation of
GST was pushed by one year.

 March 2011: The government led by the Congress party puts forth the
Constitution (115th Amendment) Bill for the introduction of GST. Following
protest by the opposition party, the Bill was sent to a standing committee for a
detailed examination.

 June 2012: The standing committee starts discussion on the Bill. Opposition
parties raise concerns over the 279B clause that offers additional powers to the
Centre over the GST dispute authority.

 November 2012: P. Chidambaram and the finance ministers of states hold

meetings and set the deadline for resolution of issues as 31 December 2012.

 February 2013: The finance minister, during the budget session, announces that
the government will provide Rs.9,000crore as compensation to states. He also
appeals to the state finance ministers to work in association with the government
for the implementation of the indirect tax reform.

10
 August 2013: The report created by the standing committee is submitted to the
parliament. The panel approves the regulation with few amendments to the
provisions for the tax structure and the mechanism of resolution.

 October 2013: The state of Gujarat opposes the Bill, as it would have to bear a
loss of Rs.14,000crore per annum, owing to the destination-based taxation rule.

 May 2014: The Constitution Amendment Bill lapses. This is the same year that
NarendraModi was voted into power at the Centre.

 December 2014: India’s new finance minister, ArunJaitley, submits the

Constitution (122nd Amendment) Bill, 2014 in the parliament. The opposition
demanded that the Bill be sent for discussion to the standing committee.

 February 2015: Jaitley, in his budget speech, indicated that the government is
looking to implement the GST system by 1 April 2016.

 May 2015: The LokSabha passes the Constitution Amendment Bill. Jaitley also
announced that petroleum would be kept out of the ambit of GST for the time
being.

 August 2015: The Bill is not passed in the RajyaSabha. Jaitley mentions that the
disruption had no specific cause.

 March 2016: Jaitley says that he is in agreement with the Congress’s demand for
the GST rate not to be set above 18%. But he is not inclined to fix the rate at
18%. In the future if the Government, in an unforeseen emergency, is required to
raise the tax rate, it would have to take the permission of the parliament. So, a
fixed rate of tax is ruled out.

 June 2016: The Ministry of Finance releases the draft model law on GST to the
public, expecting suggestions and views.

 August 2016: The Congress-led opposition finally agrees to the Government’s

proposal on the four broad amendments to the Bill. The Bill was passed in the
Rajya Sabha.

 September 2016: The Honourable President of India gives his consent for the
Constitution Amendment Bill to become an Act.

 2017: Four Bills related to GST become Act, following approval in the
parliament and the President’s assent:
o Central GST Bill
o Integrated GST Bill
o Union Territory GST Bill
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o GST (Compensation to States) Bill

The GST Council also finalised on the GST rates and GST rules. The Government
declares that the GST Bill will be applicable from 1 July 2017, following a short
delay that is attributed to legal issue.
Goods and Services Tax (GST) is an indirect tax (or consumption tax) used
in India on the supply of goods and services. It is a comprehensive, multistage,
destination-based tax: comprehensive because it has subsumed almost all the
indirect taxes except a few state taxes. Multi-staged as it is, the GST is imposed
at every step in the production process, but is meant to be refunded to all parties
in the various stages of production other than the final consumer and as a
destination-based tax, it is collected from point of consumption and not point of
origin like previous taxes.
Goods and services are divided into five different tax slabs for collection of tax:
0%, 5%, 12%, 18% and 28%. However, petroleum products, alcoholic drinks,
and electricity are not taxed under GST and instead are taxed separately by the
individual state governments, as per the previous tax system. There is a special
rate of 0.25% on rough precious and semi-precious stones and 3% on gold. In
addition a cess of 22% or other rates on top of 28% GST applies on few items
like aerated drinks, luxury cars and tobacco products.[2] Pre-GST, the statutory
tax rate for most goods was about 26.5%, Post-GST, most goods are expected to
be in the 18% tax range.
The tax came into effect from 1 July 2017 through the implementation of the One
Hundred and First Amendment of the Constitution of India by the Indian
government. The GST replaced existing multiple taxes levied by
the central and state governments.
The tax rates, rules and regulations are governed by the GST Council which
consists of the finance ministers of the central government and all the states. The
GST is meant to replace a slew of indirect taxes with a federated tax and is
therefore expected to reshape the country's $2.4 trillion economy, but its
implementation has received criticism.[3] Positive outcomes of the GST includes
the travel time in interstate movement, which dropped by 20%, because of
disbanding of interstate check posts.[4]
Formation
The reform of India's indirect tax regime was started in 1986
by VishwanathPratap Singh, Finance Minister in Rajiv Gandhi’s government,
with the introduction of the Modified Value Added Tax (MODVAT).
Subsequently, Prime Minister P V NarasimhaRao and his Finance
Minister Manmohan Singh, initiated early discussions on a Value Added
Tax (VAT) at the state level. A single common "Goods and Services Tax (GST)"
was proposed and given a go-ahead in 1999 during a meeting between the Prime
Minister AtalBihari Vajpayee and his economic advisory panel, which included
three former RBI governors IG Patel, BimalJalan and C Rangarajan. Vajpayee set
12
upa committee headed by the Finance Minister of West Bengal, AsimDasgupta to
design a GST model.
The AsimDasgupta committee which was also tasked with putting in place the
back-end technology and logistics (later came to be known as the GST Network,
or GSTN, in 2015). It later came out for rolling out a uniform taxation regime in
the country. In
2002, the Vajpayee government formed a task force under Vijay Kelkar to
recommend tax reforms. In 2005, the Kelkar committee recommended rolling out
GST as suggested by the 12th Finance Commission.
After the defeat of the BJP-led NDA government in the 2004 LokSabha
election and the election of a Congress-led UPA government, the new Finance
Minister P Chidambaram in February 2006 continued work on the same and
proposed a GST rollout by 1 April 2010. However, in 2011, with the Trinamool
Congress routing CPI(M) out of power in West Bengal, AsimDasgupta resigned
as the head of the GST committee. Dasgupta admitted in an interview that 80%
of the task had been done.
The UPA introduced the 115th Constitution Amendment Bill on 22 March
2011 in the LokSabha to bring about the GST. It ran into opposition from
the BharatiyaJanata Party and other parties and was referred to a Standing
Committee headed by the BJP's former Finance Minister YashwantSinha. The
committee submitted its report in August 2013, but in October 2013 Gujarat
Chief Minister NarendraModi raised objections that led to the bill's indefinite
postponement. The Minister for Rural Development Jairam Ramesh attributed
the GST Bill's failure to the "single handed opposition of NarendraModi".
Inthe 2014LokSabhaelectionthe BharatiyaJanataParty (BJP)led NDA government
was elected into power. With the consequential dissolution of the 15th LokSabha,
the GST Bill – approved by the standing committee for reintroduction – lapsed.
Seven months after the formation of the then Modi government, the new Finance
Minister ArunJaitley introduced the GST Bill in the LokSabha, where the BJP
had a majority. In February 2015, Jaitley set another deadline of 1 April 2017 to
implement GST. In May 2016, the LokSabha passed the Constitution
Amendment Bill, paving way for GST. However, the Opposition, led by the
Congress, demanded that the GST Bill be again sent back for review to the Select
Committee of the RajyaSabha due to disagreements on several statements in the
Bill relating to taxation. Finally, in August 2016, the Amendment Bill was
passed. Over the next 15 to 20 days, 18 states ratified the Constitution
amendment Bill and the President Pranab Mukherjee gave his assent to it.
A 21-member selected committee was formed to look into the proposed GST
laws. After GST Council approved the Central Goods and Services Tax Bill 2017
(The CGST Bill), the Integrated Goods and Services Tax Bill 2017 (The IGST
Bill), the Union Territory Goods and Services Tax Bill 2017 (The UTGST Bill),
the Goods and Services Tax (Compensation to the States) Bill 2017 (The
Compensation Bill), these Bills were passed by the LokSabha on 29 March 2017.
13
The RajyaSabha passed these Bills on 6 April 2017 and were then enacted as
Acts on 12 April 2017. Thereafter, State Legislatures of different States have
passed respective State Goods and Services Tax Bills. After the enactment of
various GST laws, Goods and Services Tax was launched all over India with
effect from 1 July 2017. The Jammu and Kashmir state legislature passed its GST
act on 7 July 2017, thereby ensuring that the entire nation is brought under a
unified indirect taxation system. There was to be no GST on the sale and
purchase of securities. That continues to be governed by Securities Transaction
Tax (STT).

1.5 How GST Works in India?

 Manufacturer: The manufacturer will have to pay GST on the raw
material that is purchased and the value that has been added to make the
product.
 Service Provider: In this case, the service provider will be responsible for
paying GST on both the product's purchase price and the value added to it.
However, the manufacturer's tax payment may be deducted from the total
GST that must be paid.
 Retailer: It must be paid by the retailer on both the product they bought
from the distributor and the margin they added. However, the retailer's tax
payment may be deducted from the total amount of GST that must be paid.
 Consumer: GST must be paid on the product that has been purchased.

1.6 Implementation
The GST was launched at midnight on 1 July 2017 by the President of India, and
the Government of India. The launch was marked by a historic midnight (30 June
– 1 July) session of both the houses of parliament convened at the Central Hall of
the Parliament. Though the session was attended by high-profile guests from the
business and the entertainment industry including Ratan Tata, it was boycotted
by the opposition due to the predicted problems that it was bound to lead for the
middle and lower class Indians. The tax was strongly opposed by the
opposing Indian National Congress. It is one of the few midnight sessions that
have been held by the parliament - the others being the declaration of India's
independence on 15 August 1947, and the silver and golden jubilees of that
occasion.[17] After its launch, the GST rates have been modified multiple times,
the latest being on 22 December 2018, where a panel of federal and state finance
ministers decided to revise GST rates on 28 goods and 53 services.

14
 Members of the Congress boycotted the GST launch altogether. They were
joined by members of the Trinamool Congress, Communist Parties of India and
the DMK. The parties reported that they found virtually no difference between
the GST and the existing taxation system, claiming that the government was
trying to merely rebrand the current taxation system.[20] They also argued that the
GST would increase existing rates on common daily goods while reducing rates
on luxury items, and affect many Indians adversely, especially the middle, lower
middle and poorer income groups.

1.7 Tax Structure before GST:

 Before the implementation of GST, taxation laws between the Centre and states
were clearly demarcated. There were no overlaps between the fiscal powers,
whatsoever. The Centre would levy tax on goods manufacture, except alcohol for
consumption, narcotics, opium, etc.

 The states had the power to charge tax on the sale of goods.

 The Centre would levy the Central Sales Tax that was collected by the
originating states.

 The Centre was also levying service tax on all types of services.
 Additionally, the Centre was charging and collecting additional duties of customs
ongoods that were imported into or exported from India. This tax was levied in
addition to the Basic Customs Duty. This additional duty of customs is referred
to as Countervailing Duty (CVD) and Special Additional Duty (SAD) and it
counter balances excise duties, state VAT, sales tax, and other such taxes.
The introduction of the GST regime made amendments to the Constitution so that
the Centre and states are empowered at the same time to levy and collect GST.
This concurrent jurisdiction of the states and Centre also requires an institutional
mechanism that ensures joint decisions are taken about the structure and
operation of GST.
Constitution (One Hundred and First) Amendment Act, 2016
In order to address prevalent issues in taxation, the Constitution 122nd
Amendment Bill was put forth in the 16th LokSabha on 19 Dec 2014.

 The Bill suggests levy of GST on all goods and services, except alcohol that
humans consume.

 The tax is levied as Dual GST by the Centre and states/union territories. The
component levied by the Centre is Central Tax - CGST, while that levied by the
state is State Tax - SGST. The tax levied by union territories is Union Territory
Tax - UTGST.

15
 The Centre would levy the GST on inter-state trade or imports of services and
goods. This tax is referred to as Integrated Tax - IGST.

 The Central Government will also levy excise duty on tobacco products, in
addition to GST.

 The tax on five petroleum products, i.e., high speed diesel, crude, petrol, natural
gas, and Aviation Turbine Fuel (ATF) will be outlined later after a decision is
made by the GST Council.

September 2016: A Goods and Services Tax Council (GSTC) was created by the
union finance minister, revenue minister, and ministers of state to take decisions
on GST rates, thresholds, taxes to be subsumed, exemptions, and other features
of the taxation system. The state finance ministers mentioned that the EC would
be a platform for states where there would be discussions of their regional issues.
The GST Council is a separate entity that would oversee the implementation of
the GST system.

1.8 Who Should Register for GST?

16
The below mentioned entities and individuals must register for Goods And
Services Tax:

 E-commerce aggregators
 Individuals who supply through e-commerce aggregators
 Individuals who pay tax as per the reverse change mechanism
 Agents of input service distributors and suppliers
 Non-Resident individuals who pay tax
 Businesses that have a turnover that is more than the threshold limit
 Individuals who have registered before the GST law was introduced.


1.9 Know the GSTIN - GST Identification Number

A 15-digit distinctive code that is provided to every taxpayer is the GSTIN. The
GSTIN will be provided based on the state you live at and the PAN. Some of the
main uses of GSTIN are mentioned below:

 Loans can be availed with the help of the number.

 Refunds can be claimed with the GSTIN.
 The verification process is easy with the help of the GSTIN.
 Corrections can be made.

GST Certificate

A GST Certificate is a legal document that the relevant authorities issue to a

company that has registered for the GST system. Under this system, enterprises
having a yearly revenue of at least Rs. 20 lakh and some special businesses must
register. Form GST REG-06 is used to issue the GST registration certificate.
From the official GST Portal, you can download the GST Certificate if you are a
registered taxpayer under this system.

The certificate is not physically handed out. It is only accessible digitally.

GSTIN, Legal Name, Trade Name, Business Constitution, Address, Date of
Liability, Validity Period, Types of Registration, Particulars of Approving
Authority, Signature, Specifications of the Approving GST Officer, and Date are
all included on the GST Certificate.

GST Returns

A GST Returns is a document that contains information about the income that a
taxpayer must file with the authorities. This information used to compute the
17
 taxpayer's tax liability. Under the Goods and Services Tax, registered dealers
must file their GST returns with details regarding their purchases, sales, input tax
credit, and output GST. Businesses are expected to file 2 monthly returns as well
as an annual return

1.10 Decisions taken by GST Council

Some of the major decisions taken by the GSTC so far are:

 There would be four tax rates under the GST regime, i.e., 5%, 12%, 18%, and
28%. Some goods and services were also classified as exempt from tax.

 A cess above the peak rate of 28% would be levied on certain sin and luxury
goods.
 The administrative control over 90% of taxpayers with turnover less than Rs.1.5
crore would be with the State tax administration. 10% of control would be with
the Central tax administration.

 Administrative control over taxpayers having turnover above Rs.1.5 crore would
be equally divided between the State and Centre tax administration.

1.11 Goods and Services Tax Network

Goods and Services Tax Network (GSTN) was set up as a private company in
2013 by the Government under Section 25 of the Companies Act, 1956. GSTN is
expected to offer the front-end services of registration, payment, and returns to
taxpayers. It would also develop back-end technical modules that will be utilised
by 25 states that have opted in.
GSTN has also identified 34 IT and financial technology companies and tagged
them as GST Suvidha Providers (GSPs). These organisations will develop
applications that will be used by taxpayers when they interact with GSTN.

1.12 Key features of the GST regime

The GST system is characterized by the following features:

 GST is applicable on the “supply” of services or goods as opposed to the
earlier concept of taxation on goods manufacture, sale of goods, or service
provision.
 GST is a destination-based tax structure unlike the origin-based structure that
existed previously.
 CGST, IGST, and SGST/UTGST are levied at rates that would be mutually
agreed upon by the states and Centre.
 GST will replace the central taxes mentioned below:
18
  Duties of Excise (medicinal and toilet needs)
 Central Excise Duty
 Additional Duties of Excise (Goods of Special Importance)
 Additional Duties of Customs (CVD)
 Service Tax
 Special Additional Duty of Customs(SAD)
 Additional Duties of Excise (Textiles and Textile Products)
 Cesses and surcharges
 GST will subsume the following state taxes:
 Central Sales Tax
 Entry Tax
 State VAT
 Luxury Tax
 Purchase Tax
 Entertainment Tax, except that levied by local entities
 Taxes on lotteries and gambling
 Taxes on advertisements
 State cesses and surcharges

 Taxpayers with annual turnover of Rs.20 lakh is exempt from GST. For
special category states, this cut-off is Rs.10 lakh. An option of compounding
is available to small-scale taxpayers with annual turnover of Rs.50 lakh or
below. The choice of threshold exemption and the compounding scheme are
optional.

 Input credit of CGST shall be used only for paying CGST on the output.
Similarly, input credit of SGST/UTGST will be used only for the payment of
SGST/UTGST. Therefore, the two channels of input tax credit cannot be
cross-utilised, except for the payment of IGST for inter-state supplies.

1.13 Benefits of GST Implementation

1. Key benefits of the GST announcement are detailed below:

2. As mentioned above, the GST system will create a common national
market that boosts foreign investment.

3. The cascading effect of taxation will be mitigated.

4. There will be uniformity in laws, rates of tax, and procedures across states

19
5. The GST regime is expected to boost manufacturing activities and exports.
This would, in turn, generate more employment and lead to the growth of
the economy.

6. Indian products would be more competitive in the international markets.

7. The GST system is likely to improve the overall investment climate in

India.

8. Uniformity in the rates of SGST and IGST will reduce tax evasion to a
large extent.

9. The average sales burden experienced by companies is expected to come

down, thereby increasing consumption and boosting subsequent production
of goods.

10. GST is a simpler system of taxation with smaller number of exemptions.

11. There are automated and simplified methods for processes such as
registration,
12. refunds, returns of GST, tax payments, etc.

13. All interactions will be handled by the common GSTN website.

14. The input tax credit process will be more accurate and transparent, as
electronic matching will be performed.

15. The final price of most goods will be lower when taxation is at the New
GST rates. There will also be a seamless input tax credit flow between the
manufacturer, retailer, and supplier of service.

16. A huge segment of small-scale retailers may be either exempt from tax or
may benefit from low tax rates based on the compounding scheme.
Consumers will further benefit if purchases are made from these small
retailers

17. Goods and Services Tax, GST is an indirect tax for the entire
nation, which makes India a common united market by ensuring
indirect taxes are replaced in the country. Passed in the Parliament on
March 29, 2017, the Goods and Services Tax Act is a comprehensive
and multi-stage tax levied on every value addition. The GST Act
came into effect on 1st July, 2017 and holds a great significance as

20
 both the Central and State Government rely on the GST for their
indirect tax revenue.

1.14 Types of GST

There are four different types of GST as listed below:

 The Central Goods and Services Tax (CGST)

 The State Goods and Services Tax (SGST)
 The Union Territory Goods and Services Tax (UTGST)
 The Integrated Goods and Services Tax (IGST)

1. The State Goods and Services Tax (SGST)

SGST is defined as one of the two taxes imposed on transactions of goods

and services of every state. Levied by State Government of every state,
SGST replaces every kind of existing state tax that include Sales Tax,
Entertainment Tax, VAT, Entry Tax, etc. Under SGST, the State
Government can claim the earned revenue.

2. The Central Goods and Services Tax (CGST)

CGST is referred as the Central Tax levied on transactions of goods and

services which take place within a state. Imposed by the Central
Government, CGST ensures to replace all other Central taxes inclusive of
State Tax, CST, SAD, etc. Prices of goods and services under CGST are
charged in accordance with the basic market price.

3. The Integrated Goods and Services Tax (IGST)

IGST is applied on the interstate transactions of goods and services. IGST is

also applicable on the goods being that are imported to distribute among the
respective states. The IGST is levied when the movement of products and
services occur from one state to another.
21
4. The Union Territory Goods and Services Tax (UTGST)

Applicable on the Intra UT supply of goods and services, the aim to impose
UTGST is to apply a collection of tax to provide benefits as same as SGST.
The UTGST is applicable to five Union Territories namely Lakshadweep,
Damn and Diu, Dadra and Nagar Haveli, Andaman and Nicobar Islands, and
Chandigarh.

1.15 Benefits of GST

These problems finally led to the introduction of GST in India. It was introduced
with the objective of reducing the problems created by multiple taxes and to
unify these taxes in one single tax. The benefits of GST are:

To the Government

1. Creation of a single national market for ease of transaction, boosting foreign

investment, and “Make in India” campaign.
2. Harmonization of laws on taxes between state and central government. A
common tax base and common system of classification of goods make an
integrated taxation system.
3. It will boost export and manufacturing activity because there is no GST levied on
export, generate more employment and therefore increase GDP leading to
substantive economic growth.
4. As all the returns of GST are filled online, it will promote a paperless economy
and will promote environmental protection.

To a Common Man

Any change in the tax system of a country greatly affects a common man. The tax
system determines the inflation or deflation in the price of the products or
services consumed. So, the benefits of GST to a common man are:

1. As multiple taxes are subsumed by GST tax, the procedural aspect, which
includes filing returns, has become easier and has increased ease of doing
business.
2. The cascading effect is not present as GST allows for the facility of Input Tax
Credit where tax already paid on input is used as a credit to reduce the tax
payable on the output.

22
3. As export is a Zero-rated supply, which means there is zero % tax on exports, a
business can sell its product in the international market at a lower price, which
gives the company a competitive edge.
4. The taxpayer’s burden is reduced as they don’t have to pay multiple taxes on the
same transaction, which would lead to more consumption, which in turn means
more production.
5. As the tax burden on the sellers has reduced because of the reduction of the
cascading effect, the price of the goods or services reduces, thereby increasing
the liquidity in the hand of the customer, which they can put in different uses. For
Example, the burden of all the taxes on drugs was about 13% in the pre GST era.
In the GST era, most of the life-saving drugs are in the 5% GST tax slab.
6. Purchasing goods from small retailers who are covered under the GST exemption
will cost less for consumers.
7. Advantages of GST to Consumers
8. 1. Decrease in the price of goods & services Since GST is charged at all levels of
the supply chain, a considerable difference can be found in the prices of the
products. While consumers would have to pay separate taxes before, they now
have to pay just one tax. A customer will be able to avail the advantages of GST
cost that will be lesser than VAT or service taxes. Food items, such as basic food
grains & spices fall under the Range 0-5% GST, this might be extremely
beneficial for the customers as they are cheaper to buy. Packaged products like
shampoos, tissue papers, toothpaste, soaps, electronic items have become
cheaper. Other observed GST slab rates are: 5% corresponds to mass
consumption items such as Spices 12% corresponds to processed food 28%
corresponds to white goods 28% plus cess correspond to luxury goods, aerated
drinks, tobacco, etc.
9. Same price around the country One of the major advantages of GST is the fact
that a consumer will be able to avail the product at the same price anywhere in
the country. However, the products that fall under the GST tax-slab come under
this advantage. Simplified tax system The entry of GST into the Economy has
made the tracking of taxes easier than ever before. Since GST works on a
computerized system, consumers can be fully aware of the amount they are
paying in taxes for the goods and services. Every time you purchase goods and
services; you will be able to see the amount you paid in tax on the Receipt.

1.16 Slab rates for different categories of goods and services

23
 Goods
The tax slabs have been decided upon the necessity of goods or services. Any
essential commodity is placed under lower tax slabs whereas any luxury for a
normal person is placed under higher tax slabs.

GST RATES (June 2020) FOR ESSENTIAL COMMODITIES AND PRODUCTS OF

DAILY NEED

Category Tax Rates Products

Inbranded Atta, Fresh milk, curd, Fresh vegetables,

E Exemption
eggs, Cereals, water(not aerated), common salt,
/ Nil
meat(not in a container)

Ttea, coffee, edible oil, sugar, spices, dried vegetables

5%
Good and beverages packed in containers and bearing registered brands.

Vegetables, fruits, nuts preserved using sugar/

2%
vinegar/acetic acid.

8% Chocolate and cocoa products

E exemption
Human blood, contraceptive, sanitary pads
/ Nil

Life-Saving drugs including oral rehydration salts,

5% vaccines, medicine for diabetes, tuberculosis, HIV-
AIDS, Insulins, artificial kidneys and stents
Medicines,medical
instruments,and Foothpowder, bandage, gauge, photographic
sanitary products 2%
films/plates in X-Rays

Medicine containing nicotine Polacrilex like Nicotine

Gum;
8%
Haircare products (except Mehendi), hospital
furniture such as beds, operating tables

24
 8% No pharmaceutical product under this slab

Apparel and clothing accessories, knitted or

5% crocheted, of selling value exceeding Rs. 1,000 per
piece.

Apparel and clothing accessories, knitted or

Apparels and Footwears
1 2% crocheted, of selling value exceeding Rs. 1,000 per
piece.

Clothes made of vulcanized rubber, fur skin or

8%
leather (other than sports glove)

Without ITC, Residential property which is not a part

5%
of the affordable housing segment.

Real Estate Without ITC, Residential property which is not a part

5%
of the affordable housing segment.

2% Commercial properties

GST RATES FOR LUXURY PRODUCTS AND INJURIOUS SUBSTANCES

Category Tax Product

Smoking pipes (including pipe bowls) and cigar or cigarette

holders

Unmanufactured tobacco; tobacco refuse [other than tobacco

Injurious leaves]
8%
substances
Pan masala

Caffeinated Beverages

Motor vehicles 5%
Carriages including motor and non-motor vehicles for disabled

25
 persons

Vehicles running on electric motors, fuel cells.

2% Bicycle and its parts and accessories

Rickshaws, animal-drawn vehicles

Motor cars for the transport of persons. It includes Racing cars as

well.

Petrol/CNG/LPG car with less than 1200 CC and length which is

less than 4 meters.
8%
Petrol/CNG/LPG car with less than 1200 CC and length which is
more than 4 meters.

Motor vehicles for the transport of goods.

1.17 services under different GST Rates

GST rates have been divided into 5 parts - 0% (exempted),5%, 12%, 18%& 28%.
List of items under the 5% GST slab rate
The lowest standard rate applies mostly to household necessities and daily
essentials. Refer to the following table to find the products and services with a
5% tax rate under GST. Refer to the table to understand what GST percentage
applies to particular goods.
Goods
1) Edibles like:
 Spices,Plainchapati ,Oil,Pizzabread,Fishfillets,Khakhra ,Tea,Coffee (excluding
instant coffee),Baby food,Sugar,Cashewnuts,Indian sweets (Mithai or
Mishti),Frozen vegetables,Unbrandednamkeen,PawanChakki or wind-based Atta
Chakki

26
 Fuel like:Coal,Biogas:

1)Fertilisers,
2)Life-saving medicines and drugs
3)Accessoriesforspecially-abledindividuals
4) Incense sticks or Agarbatti
5) Footwear and apparels under Rs.1000
6) Handmade items like:Carpets,Gabba/Namda,Braids,Ornaments
7) Natural cork,
8) Fly-ash blocks,
9) Numismatic coins,
10) Ice and snow
11) Kites,14) Marble rubble

Services
1) Aircraft leasing,
2) Crude and petroleum products transport,
3) Takeaway food,
4) Economy class flight tickets ,
5) Newspaper printing,
6) Tailoring,
7) Transport services via AC cabs andradio taxi,
8) Restaurants:
9)Both AC and Non-AC standalone ones
10)Those with a turnover of Rs.50 lakhs
11)Those in hotels with a sub-Rs.7500 room tariff 9) Print media advertisement
space
12) Tour operator services

1.18 List of items under the 12% GST slab rate

The GST rate list for secondary necessities, mostly comprising processed food,
cooking utensils, and other such items has been summarised below.
Goods
1) Processed food:Frozen meat,Sausage ,Fruit juices,Sauces (except salad dressing
items),Ketchup,Cakes,Pickles,Boiled sugar confectionery
2) Dairy products:Butter,Cheese,Ghee
3) Dry fruits and nuts like almonds
4) Packaged products:Drinking water,Coconut water
5) Cooking utensils:Forks ,Spoons,Fishknives,Tongs,Ladles,Cake servers
6) Sewing machines
27
7) Flint buttons
8) Corrective spectacles and glasses
9) Exercise books and notebooks
10) Walkie-talkies or two-way radios
11) Handmade matches
12) Fixed speed diesel engines
13) Ornamental framed mirrors
14) Containers:Purses,Pouches ,Handbags,Jewellery box
15) Photographs,
16) Diagnostic kits
17) Plastic beads18) Man-made yarn

Services
1) Business class flight tickets
2) Movie tickets worth less than Rs.100
3) Hotel stay with daily cost less than Rs.7500
4) Room tariff above Rs.1000 and below Rs.2500 per day
5) Mining and drilling of natural gas
6) Real estate construction for sale IP rights on a temporary basis
7) Foremen-led chit fund services
8) Railway coaches, wagons, or rolling stock sans refund of ITC
9) Eating and drinking at outlets without a liquor license or AC
10) Goods Transportation in containers via rail not under the Indian Railways
Now, there might be a lot of products or services you might be opting for quite
frequently, which have not been covered under any of the already-mentioned
GST slab rates. Well, we hope that you will find these items under the next tax
category.

1.19 List of items under the 18% GST slab rate

The 18% GST rate covers quite a number of relatively essential items. If you have
been wondering what percent of GST is applicable against some of your most
sought-after products/services, here might be your answer since this section
includes a majority of items compared to the other slabs.

28
Goods
1)Eatables:
Mineralwater,Pasta,Biscuits,Pastries,Cornflakes ,Soups,Currypaste,Preservedveg
etables,Instant food mixes ,Food supplements ,Mixed condiments,Flavoured
refined sugar,Cocoabutter,Icecream,Chocolate,Chewing gum

2) Capital goods:
Plastictarpaulin,Salt-glazed stoneware pipes,Jute, artificial plastic,
Aluminiumfoil,Opticalfibre,Windingwires,Coaxialcables,Ballbearing,Rollerbeari
ng,Helmets and helmet parts,Electrical boards ,Diesel engine parts,Parts of
pumps,Precast concrete pipes,Tyres and tyretubes,Retreaded second-hand rubber
tyres,Wheel rims and axles,Paints.

3) Household products:
Hair oil,Shampoo ,Toothpaste,Detergent,Roomdeodorisers, Shaving and after-
shave productsMattress,Furniture (including those made of bamboo) Perfume
Cosmetic preparations Make-up and beauty products Weight-measuring devices

4) Installations:
Doors and windows, Sanitaryware, Aluminium frames Electricalandelectronic

5)appliances:
 Refrigerators,Waterheaters,Washingmachines,
 Televisions(upto32inches),Computer monitors (below17inches),
 Camera ,
 vacuumcleaners,
 Hairshavers,
 Haircurlers,
 Hairdryers,Fans,Lights,Pumps,
 Compressors,
 Set-top box for TVs,
 Discharge lamps ,
 Power banks with Lithium-ion batteries,
 Printers and cartridges
 Containers
 Suitcase,
 Vanity case,
 Briefcase,
 Cotton handbags,
 Shopping bags,
 Polythene and Polypropylene packets and bags,
29
  Non-leather school bags
 Dental wax
 Kajal pencils
 Electrical transformer
 Measuring devices like callipers,
 tapes,
 Leather clothing
 Wrist watches

Cooking items:
 Stoves
 Cutlery
 Cookers
 Telescope
 Razor and razor blades
 Goggles
 Binoculars

Stationary:
 Pencil-sharpeners,
 Clips ,
 Staplers
 Carriages for specially-abled individuals and babies
 Sports goods
 Video game consoles
 Other products with HSN code 9504

Services
1) Movie tickets worth more than Rs.100
2) Hotel accommodation bill equal to or above Rs.7500
3) Daily room tariff ranging between Rs.2500 and Rs.5000
4) Eating at restaurants located in hotels with above Rs.7500 daily tariff
5) Telecom and IT services
6) Outdoor catering
7) Performance arts:Theatre,Indian classical and folk arts,Circus
8) Party arrangement

30
9) Eating and drinking at outlets with a liquor license, AC and heating arrangement.
List of items under the 28% GST slab rate
The GST percentage for most luxury items is set at 28%, which is the highest
standard rate. However, some of these items again come with an additional
charge on top of the GST slab rates. This is called Cess, and it is a compensation
charge to make up for the lack of revenue due to GST implementation. Have a
look at the following table to understand which services and products belong to
each of these categories.

Goods

Without Cess

1) Eatables :Aerated water (with or without sugar), Instant coffee, Chocolates

(without cocoa), Coffee concentrates, Custard powder, Protein concentrates,
Sugar syrups, Molasses
2) ATM vending machine
3) Air conditioners
4) Dishwashers
5) Yachts
6) Aircrafts
7) State-owned and state-authorised lotteries
8) Accessories: Eyelashes ,Wigs, Felt hats, False beards
9) Fax machines
10) TV monitors over 32 inches
11) Stoves (excluding LPG and kerosene ones)
12) Powder

With Cess

1) Caffeinated beverages
2) Tobacco and tobacco products
3) Pan masala and Gutkha
4) Fuel:Petrol, LPG, CNG
31
5) Motorised vehicles (except motorcycles)

Services
1) Hotel stay with over Rs.7500 bill
2) 5-star hotel services
3) Gambling
4) Go-karting
5) Ballet
6) Racing club services
7) Casinos
8) Entertainment services,
9) Theme parks, amusement parks, and joy rides
10) Sports events

Now, there are many items that are considered unavoidable necessities. To
help individuals of every economic stratum get access to such products and
services, these items come with 0% GST. Read on to know where such taxes are
applicable.

1.20 GST-exempted goods and services

The items that do not fall under any of the GST slab rates have been listed in
the following table.
Goods
1) Eatables :
Raw fruits and vegetables,
Milk,
Buttermilk,
Curd,
Flour ,
Bread ,
Salt ,
Natural honey,
Jaggery,
32
Fresh meat,
Hulled cereal grains,
Eggs ,
Besan
Sanitary napkins
Bindi
Sindoor
Bangles
Handloom
Jute
Saal leaves
Items of paper: Printed books, Newspapers,Judicial papers
Stamp
Rakhis not studded with precious metals and stones
Idols made of wood, stone, or marble

Services
1) Hotel stay with room tariff less than Rs.1000
2) Bank charges on savings account
In addition to the GST rates for the various items mentioned above, there
are different rates for certain special items as well. Some of these are as follows.
3) Gold jewellery: 3% GST is applied on the final bill.
4) Real estate purchase: 1% on affordable and 5% on non-affordable under-
construction properties. Fully constructed properties are exempted from this tax.
Now that you have quite a clear idea of the different GST rates in India and
the inclusions under each of these slab rates, cross-checking those payment
receipts would not be confusing anymore. We hope this detailed analysis of the
various products has helped you!

1.21 Advantages to the Common Man

 A good number of products and/or services are either exempt from tax or charged
at 5% or less.
 The poor will receive their due.
33
 Small traders will find themselves on a level playing field.
 Simplified tax structure with fewer exemptions.
 Products and services will be allowed to move freely across the country.
 Increased competition between manufacturers and businesses will benefit
consumers.
 Items such as movie-ticket prices, two-wheelers, televisions, stoves, washing
machines, SUVs and luxury cars, two-wheelers, etc. will be cheaper.

1.22 Disadvantages of GST

 Compliance burden: You need to deposit GST and file returns on time. GST
returns filing is not as easy as it seems to be. You need to hire a tax professional
to manage it. Although, Government has been taking steps to simplify the returns
filing and keep it simple. But, still it will take time to actually smoothen the
entire process.
Although big businesses having ample staff can handle the whole process very
easily. But, what about small traders/service providers or individuals who have
just started their business or service, isn’t that getting a bit complex for them? A
small exemption in this regard might be a big sigh of relief for such people!

 Service tax rate @ 15% is presently charged on the services. So, if GST is
introduced at a higher rate which is likely to be seen in the near future, the cost of
services will rise. GST shall be charged @18% on maximum services and shall
reach upto 28% for few services. In simple words, all the services like telecom,
banking, airline etc. will become more expensive.

 Increased cost of services means, an add on to your monthly expenses.

 You will have to reschedule your budgets to bear the additional services cost.

 Businessmen and service providers are still learning about the new laws. This
will increase reliance on tax experts and professionals and further add to your
business expenses.

 Being a new tax, it will take some time for the people to understand
it completely. Its actual implications can be seen after a certain period of time.

 It is easier said than done. There are always some complications attached. It is a
consumption based tax, so in case of services the place where service is provided
needs to be determined.

 Proper invoicing and accounting needs to be done to ensure better compliance.

However, GST Accounting Software are being developed in this regard by
various companies.

34
 If actual benefit is not passed to the consumer and the seller increases his profit
margin, the prices of goods can also see a rising trend.

 An increase in inflation might be seen initially that may come down gradually.

 A strict check on profiteering activities will have to be done, so that the final
consumer can enjoy the real benefits of GST.

 Although, a large number of officers have been trained and a systematic IT

software developed for the successful implementation of GST. But, it will take
some time for the people including the manufacturers, the wholesalers, the
retailers or the final consumers to understand the whole process and apply it
correctly.

1.23 Negative Impact of GST on Common man:

 Compliance burden: You need to deposit GST and file returns on time. GST
returns filing is not as easy as it seems to be. You need to hire a tax professional
to manage it. Although, Government has been taking steps to simplify the returns
filing and keep it simple. But, still it will take time to actually smoothen the
entire process.
Although big businesses having ample staff can handle the whole process very
easily. But, what about small traders/service providers or individuals who have
just started their business or service, isn’t that getting a bit complex for them? A
small exemption in this regard might be a big sigh of relief for such people!

 Service tax rate @ 15% is presently charged on the services. So, if GST is
introduced at a higher rate which is likely to be seen in the near future, the cost of
services will rise. GST shall be charged @18% on maximum services and shall
reach upto 28% for few services. In simple words, all the services like telecom,
banking, airline etc. will become more expensive.
 Increased cost of services means, an add on to your monthly expenses.
 You will have to reschedule your budgets to bear the additional services cost.
 Businessmen and service providers are still learning about the new laws. This
will increase reliance on tax experts and professionals and further add to your
business expenses.
 Being a new tax, it will take some time for the people to understand
it completely. Its actual implications can be seen after a certain period of time.
 It is easier said than done. There are always some complications attached. It is a
consumption based tax, so in case of services the place where service is provided
needs to be determined.
 Proper invoicing and accounting needs to be done to ensure better compliance.
However, GST Accounting Software are being developed in this regard by
various companies.

35
 If actual benefit is not passed to the consumer and the seller increases his profit
margin, the prices of goods can also see a rising trend.
 An increase in inflation might be seen initially that may come down gradually.
 A strict check on
Dearergoods pevious effective
GSTrat erate %
e%

profiteering activities will have to be done, so that the final consumer can enjoy
the real benefits of GST.
 Although, a large number of officers have been trained and a systematic IT
software developed for the successful implementation of GST. But, it will take
some time for the people including the manufacturers, the wholesalers, the
retailers or the final consumers to understand the whole process and apply it
correctly.

Source: TheEconomic Times,July 1st,2018

Table 1:

36
 bread,butter,ghee&c
cheese
Table Agarbatti 12 > 0
Jam&jellies 18 > 12
Chocolates 28 > 25-26
Pasteries& cake 18 > 11-15
Instantcoffee 28 > 26
Sanitarynapkins 12 > 5-6
Razor 28 > 26
Shavingcream,haircream 28 > 26
List of
consumer durables

<
Consumer GSTrate% > Previous effective
durables rate%
AC 28 > 25-26
Washingmachine 28 > 25-26
Coolers 28 > 23-24
Refrigerators 28 > 24-27
Cellephones 12 > 6

Source: The Economic Times,July 1st,2018

List of utility
<
Utilitybills > Previous effective
GS rate%
Trat
e%
Telecom 18 > 15
Insurance 18 > 15
Coachingclass 18 >
15
Jewellery 3 > 2.5
Leatherbags 28 > 6
Wristwatches 28 > 26
Furniture 28 > 26

37
List of leisure
<
Leisure > Previous effective
GSTrate rate%
%
Movietickets (>Rs.100) 28 > 22-23
Fivestarrestaurants 28 > 18
A/CAlcoholservingrestaurant 18 < 22
s
Airtickets(economy) 5 < 6
Averageroomtariff(Rs.2,500- 18 < 28
7,500)
Averageroomtariff 28 > 28-30
(>Rs.7,500)

Source: TheEconomic Times,July 1st,2018

Listof Vehicles

<
Vehicles GSTrate% > Previous effective
rate%
Bicycle 12 < 18.5
Two-wheelers 28 > 27-30
Smallpetrolcar 29 > 27-30
Smalldieselcar 31 > 27-30
Largecar(<1.5Lengi 43 > 43-47
ne)
Largecar(>1.5Lengi 43 > 47-51
ne)
Rubbertyres 28 > 18.5

38
 CHAPTER 2 : OBJECTIVES OF STUDY

2.1 Objectives Of the Study:

1) To Study what is Goods and Service Tax.

2) To Study the awareness of GST among people in Thane City.

3) To Examine the Consumers are Satisfied about GST.

39
 CHAPTER 3: REVIEW OF LITERATURE

3.1 Literature Review

Rathod.M.K(2017)„AnoverviewofGoodsandServicestax(GST)inIndia‟,Journalofco
mmerce and management, issue20

Sharma.P,kumar.M(2017)„exploringplausibleeffectsofGSTongoodsandservicessec
torinwesternIndia‟, Indian journalof finance,vol11, issue12

LourdunathanF,XavierP(2017)‟Astudyonimplementationofgoodsandservicestax(
GST)inIndia–prospectsandchallenges‟,Internationaljournalofappliedresearch,
vol3,issue1

Muthupandi.S,Xavier.J(2017)„Awarenessofimplementationofgoodsandservicestax
(GST)amongcollegestudentsinSivakasi‟,IJESC,vol 7,issue4

Leemput.E.v.,Wiencek.E.A.(2017)„TheeffectofGSTonIndiangrowth‟,IFD

PnotesGarg.Y,Gupta. J(2017)WWW.Conferenceworld.in

Dhamija.S.K, Kumar. D, Dhamija. M (2016)‟An exploratory study on

evolutionandimplementationofGSTinIndia‟,SDCC‟sJournalofcommerce&mana
gement,vol3,issue2

Kalyani.S.R“Study on Impact of GST in India”

Priya.B.M(2017)‟GST-
Agamechanger‟,InternationalJournalofManagementResearchandsocialscience,
vol 4, issue1

40
Charan. P, Benjamin. R, Khan. Z.H. (2017) „Goods and services tax (GST) bill
2016gearingupfornextbigwaveintheIndianeconomy‟,Internationaljournalofscientifi
candengineeringresearch,vol 8, issue1

Tondon. N, Tondon. D (2017)‟Analysis of Goods and services tax (GST)

enigmainIndiaprospects,implicationsandrollout‟,JournalofMadhyaPradeshEco
nomicAssociation,volXXVII,No.1

MujaldeS,VaniA(2017)„Goodsandservicestax(GST)anditsoutcomeinIndia‟,journal
ofMadhya pardesheconomicassociation, vol XXVII,No.1

PeguB(2017)‟TheproposedGSTandIndianeconomy‟InternationalJournalofinterdis
ciplinaryResearchin science, societyand culture (IJIRSSC), vol 3, issue1

KumarV„GST:positiveandnegativeeffectsoncommonmaninIndia‟,journalofcomm
ereandtrade, vol XI, no. 2

Anbuthami B, Chandrasekaran N (2017) „Goods and services Tax (GST) and

trainingforitsimplementationinIndiaAperspective‟,ICTACTInternationaljournalof
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42
 CHAPTER 4 : RESEARCH METHODOLGY

4.1 Hypothesis:-

For objective 1 Hypothesis is as follows:

H0(Null Hypothesis): GST is Easy to Understand.

H1 (Alternate Hypothesis): GST is Not Easy to Understand.

For objective 2 Hypothesis is as follows:

H0 (Null Hypothesis): People in Thane City does not have awareness of Goods and
Service Tax.
H2 (Alternate Hypothesis): People in Thane City have awareness of Goods and
Service Tax.

For objective 3 Hypothesis is as follows:

H0 (Null Hypothesis): People are Not Satisfied About GST

H3 (Alternate Hypothesis): Peoples are Satisfied about GST.

4.2 Scope of the Study:-

The study aims to find out the awareness level and the effectiveness of GST. The
analysis will help to know the awareness level of customers regarding the GST .
Along with the satisfaction level of the customers in the internet Goods and Service
Tax and the customer’s perception regarding the Goods And Service Tax.

43
4.3 Type of Research:-

The type of research is Descriptive in nature. Descriptive research is undertaken

to describe the characteristics of variables of interest in a situation e.g. a study of
students in terms of age groups, sex.

4.4 Sample Size:-

The Population of the study consists of people in Thane City. The sampling
method is Convenience Sampling. In Convenience sampling, the convenience of
the researcher is given importance while selecting the sample. Sample is selected
as per the convenience of the researcher.

4.5 Total Sample Size = 50

Area of Study:-

The above research will be done amongst people in Thane City.

Data Collection:-

Data will be collected through both the sources i.e. Primary and Secondary Data.
Primary Data will be collected through well-structured questionnaire. Secondary
Data required for the study will be collected from journals, reports, books,
records, magazines and internet.

44
 CHAPTER 5: DATA INTERPRETATION & DATA ANALYSYS

TABLE 1:

Table 1: Distribution of sample respondents according to their

Age.

Age No of Respondent Percentage

Less than 20 3 6
20 to 40 40 80
40 to 60 7 14
60 and above 0 0
Total 50 50

45
 Figure

Source: Primary data

Data Interpretation:-
Out of 50 respondents, 3 respondents are below the age group of 20, 40
respondents are between the age group of 20-40, 7 respondents are between
the age group of 40-60, and remaining no respondents are from the age group
of above 60.From the findings we can summarize that among all age groups
most of the respondents are between the age group of 20-40 i.e. 80%
respondents.

TABLE 2:

Table 2: Distribution of sample respondents according to their

Gender.

Gender No. of Respondents Percentage

Male 29 58

46
 Female 21 42
Total 50 50
Figure:

Source: Primary Data

Data Interpretation:-
Out of 50 respondents, 29 respondents are Male and remaining 21
respondents are Female.

TABLE 3

Table 3: Distribution of sample respondents according to their Qualification..

Qualification No of respondents Percentage

Under Graduate 8 16
Graduate 20 40
Post Graduate 19 38

47
 Other 3 6

Figure:

INTERPRETATION:

Among 50 respondents 16% are under Graduate, 40% are , 36% are Graduate
38% Post Graduate and 6% are Others.

TABLE 4

Occupation No of respondents Percentage

Student 15 30
Professional 4 8
Service 18 36
Businessman 3 6
Other 10 20
Total 50 100

Figure 4

48
 INTERPRETATION:

Among 50 respondents 30% areStudents,8 % are professionals , 36% are Service,

6%Businessman and 20% are Others.

TABLE 5:

YEARLY INCOME NO OF NO OF PERCENTAGE

RESPONDENTS
0 to 250000 20 40
Upto 250000 7 14
250000 to 500000 9 18
500000 to 750000 8 16
750000 to 1000000 4 8
1000000 & above 2 4
Total 50 100
Figure

49
 Interpretation:

Among 50 respondents 40% are earn o to 250000, 14% earn upto 250000, 18%
earn 250000 to 50000, 16% are earn 500000 to 750000, 8% are earn 750000 to
1000000 and 4% earn more than 1000000.

TABLE 6:

Awareness about GST No of Responses Percentage

Yes 43 87
No 7 13
May be 0 0
Total 50 100

50
 Figure

INTERPRETATION:

87% People are aware about GST which are 43 respondents and 13 % Peoples
are not aware about GST i.e 7 respondents.

TABLE 7:

Tax Reform No of Responses Percentage

Strongly Agree 7 14
Agree 29 58
Neutral 5 10
Strongly Disagree 1 2
Disagree 8 16
Total 50 100

Figure 7

51
INERPRETATION:

Out of 50 respondent’s 7 people Highly Agree about tax reforms of GST, as well
as 29 people Agree, 5 people neutral , 1 people strongly Disagree and 8 people
disagree.

TABLE 8:

Tax Burden No of Responses Percentage

Strongly Agree 7 14
Agree 20 40
Neutral 14 28
Strongly Disagree 7 14
Disagree 8 16
Total 50 100

52
Figure

INERPRETATION:

Out of 50 respondent’s people Highly Agree about GST has Increase Tax burden
on Common man , as well as 20 people Agree, 14 people neutral , 7 people
strongly Disagree and 8 people disagree.

TABLE 9:

Difficulty No of Responses Percentage

Strongly Agree 3 6
Agree 13 26
Neutral 14 28
Strongly Disagree 10 10
Disagree 15 30
Total 50 100

53
Figure

INERPRETATION:

Out of 50 respondent’s 6% people Highly Agree about GST is very difficult to

understand, as well as 26% people Agree, 28% people neutral , 10% people
strongly Disagree and 30% people disagree.

TABLE 10:

Beneficial No of Responses Percentage

Strongly Agree 3 6
Agree 16 32
Neutral 24 48
Strongly Disagree 1 2
Disagree 6 12
Total 50 100
Figure 10

54
INERPRETATION:

Out of 50 respondent’s 7 people Highly Agree about tax reforms of GST, as well as
29 people Agree, 5 people neutral , 1 people strongly Disagree and 8 people
disagree.

TABLE 11:

Affecting Small No of Responses Percentage

Business
Strongly Agree 1 2
Agree 17 34
Neutral 17 34
Strongly Disagree 2 4
Disagree 13 26
Total 50 100

Figure:11

55
INERPRETATION:

Out of 50 respondent’s 7 people Highly Agree about tax reforms of GST, as well
as 29 people Agree, 5 people neutral , 1 people strongly Disagree and 8 people
disagree. TABLE 12

Cost of living No of Responses Percentage

Strongly Agree 2 4
Agree 14 28
Neutral 23 46
Strongly Disagree 2 4
Disagree 9 18
Total 50 100

Figure 12:

56
INERPRETATION:

Out of 50 respondent’s 4% people Highly Agree about increase cost of living, as

well as 28% people Agree, 46% people neutral , 4% people strongly Disagree
and 18% people disagree.

TABLE 13:

Confused customers No of Responses Percentage

Yes 43 86
No 7 14
Total 50 100

Figure 13

57
INERPRETATION:

86% People i.e 43 peoples said yes to Newly implemented GST confused the
Customers and 14 % people i.e 7 people said No.

TABLE 14:

Save Income No of Responses Percentage

Strongly Agree 2 4
Agree 22 44
Neutral 20 40
Strongly Disagree 0 0
Disagree 6 12
Total 50 100
Figure 14:

58
INERPRETATION:

Out of 50 respondent’s 4% people Highly Agree about GST encourages

individual to save income as well as 44% people Agree, 40% people neutral ,
0% people strongly Disagree & 12% people disagree.

TABLE 15:

Higher prices of goods No of Responses Percentage

& Services
Yes 18 36
No 8 16
Maybe 24 48
Total 50 100
Figure 15:

59
INERPRETATION:

36% People i.e 24 peoples said yes to and 16 % people i.e 7 people said No and
48% said Maybe.

TABLE:16

Purchasing Power No of Responses Percentage

Yes 25 50
No 10 20
Maybe 15 30
Total 50 100

Figure 16:

60
INERPRETATION:

50% People i.e 25 peoples said yes to and 20 % people i.e 10 people said No and
30% said Maybe.

TABLE 17:

Purchasing Power No of Responses Percentage

Yes 36 72
No 14 28
Total 50 100

Figure 17:

61
INERPRETATION:

72% Peoples are Satisfied about GST.

28% Peoples are not Satisfied about GST.

62
 CHAPTER 6: LIMITATIONS OF STUDY

6.1 Limitation of the Study:-

1. The study is confined in Thane city only.

2. Data is Personal Basis so Accuracy is not True.
3. sample size of 50 respondents only
4. Short Sample Size
5. Lack of Time
6. The customers were not interested in filling questionnaire because of their
busy schedule.

63
 CHAPTER NO 7 :CONCLUSION

It can be concluded that GST will be game changing reform for Indian economy,
by developing a common market for Goods and Services and reducing the
cascading effects of tax on the cost of goods and service. It will impact the Tax
structure, Tax Incidence, Tax Computation, Tax payment, compliance, Credit
Utilization and Reporting, Leading to a complete transformation of the Current
taxation system.Do the consumers get the benefits from GST?. This is a very
tricky question and there is no definitive answer to this, as for the producers and
the government, the straight answer was YES. But the benefits from GST for the
consumers it is not that simple. This is because the GST will have different
impact on different goods and services used by consumers. One thing is for
certain that, it will bring down the prices and leading to increasing the demand
for goods and services which would benefit to the consumers, but not everything
will become cheaper. If the government will take necessary care for essential
commodities prices, there will not be any hike and then the consumers will not
suffer. With all these facts stated above, there is no denying the fact the GST
impact on consumers looks like a mixed kitty, making few things cheaper and
some costlier.

64
 CHAPTER NO 8: REFERENCES

1. Anshu Ahuja. Perceptions of people towards goods and services tax Kaav
International Journal of Economics, Commerce & Business Management. 2017;
4(3). ISSN No: 2348-4969.

2. Gowtham Ramkumar. Impact of GST on consumer spending ability in

Chennai city, Primax International Journal of Commerce and Management
Research (PIJCMR). 2017; 5:3. Impact factor 4.532, Print ISSN 2321-3604,
Online ISSN 2321-3612.

3. Dr. Manoj Kumar Agarwal. People’s perception about GST – An Empirical

Study, Kaav International Journal of Economics, Commerce & Business
Management, 2017;

4(3). ISSN No:2348-4969 4. Sapna Almuna. Goods and Services Tax (GST): A
Brief Introduction, International Journal of Research in Commerce and
Management, 2017.

5. Jatin. Awareness towards Goods and Services Tax in India, The International
Journal of Informative and Futuristic Research. 2017-2018.

6. Ling SC. Public Acceptance and Compliance on Goods and Services Tax
(GST) Implementation: A case study of Malaysia, Asian Journal of Social
Science and Humanities. 2016; 5(1):1-12.

7. Shikha Tiwari CA. (Ex-Employee) GST Articles, Taxes in India

8. www.economictimes.

9. www.indiatimes.com

10. www.financial express.com

11. www.gstindia.com

12. www.iosrjournal.com

65
 CHAPTER NO 9: QUESTIONAIR

1.Age:

a. Below 20 years
b. 20-40
c. 40-60
d. 60 & Above

2.Gender:

a. Male
b. Female
c. Other

3.Education

a. Under Graduate
b. Graduate
c. Post Graduate
d. Other

4.Occupation

a. Student
b. Professional
c. Service
d. Businessman
e. Other

5.What is your yearly Income?

a. 0 to 250000
b. 250000 to 500000
c. 500000 to 750000

66
 d. 750000 to 1000000
e. 1000000 & Above

6.Are you aware about GST?

a. Yes
b. No
c. Maybe

7. GST is very good Tax reforms in India.

a. Agree
b. Strongly disagree
c. Disagree
d. Neutral
e. Strongly Agree

8.GST has increased the tax burden on common man.

a. Agree
b. Strongly disagree
c. Disagree
d. Neutral
e. Strongly Agree
9.GST is Very difficult to understand.

a. Agree
b. Strongly disagree
c. Disagree
d. Neutral
e. Strongly Agree

10.GST is very Beneficial in long term.

a. Agree
b. Strongly disagree
c. Disagree

67
 d. Neutral
e. Strongly Agree
11.GST will affecting small business very badly.

a. Agree
b. Strongly disagree
c. Disagree
d. Neutral
e. Strongly Agree
12. GST will cause an increase in the cost of living.

a. Agree
b. Strongly disagree
c. Disagree
d. Neutral
e. Strongly Agree
13. Newly implemented GST confused the customers.

a. Yes
b. No
14. GST encourages individuals to save part of their income.

a. Agree
b. Strongly disagree
c. Disagree
d. Neutral
e. Strongly Agree

15. Do you think implementing GST will cause of higher price of goods and
services.

a. Yes
b. No
c. Maybe

68
16. GST is impact customers purchasing Power effectively.

a. Yes
b. No
c. Maybe
17. Are you satisfied about GST.

a. Yes
b. No

69
THANK YOU

70