The Indian economy is set to undergo a significant shift with a major tax policy change through GST. This change will directly impact businesses and every Indian citizen, and we hope for the best outcomes. Welcome to our in-depth analysis of the Goods and Services Tax (GST), where we provide you with a comprehensive ‘GST: An Outlook.’ In this article, we will delve into the implications, changes, and future prospects of GST in India as well as the necessity of having a good ERP software for business.
The real Unity in Diversity is going to Happen in India
India got freedom in 1947 from the clutches of foreigners. However, we found ourselves bound by the self-imposed limitations of the tax laws in each state. Citizens of India are separated based on their culture, language, religion, as well as on the point of taxation. Through the implementation of GST, India is becoming united in taxation. An Indian can now sell goods or services anywhere in India without discrimination, using the GSTIN. Businessmen will enjoy the simplicity in conducting business compared to the complexity of state-wise Sales Taxes. Even though there are many apprehensions about GST, such as its multi-layered taxes and high rates of up to 28%, there is a buzz that the Indian economy is going to become powerful and transparent. Amidst criticisms, people are welcoming the new tax system.
One Office One India
Now, anyone can conduct business across India using a single GST registration. Instead of dealing with multiple tax and government offices like Central Excise and State tax offices for various registrations, it becomes much simpler through a single registration on the GST Network web portal. GST facilitates the maintenance of different branch offices or warehouses across the country using one GST registration. It helps manage businesses with utmost ease. Additionally, it makes the analysis of business data very simple.
Eradicating Tax Anomalies
The GST system is poised to eliminate several tax anomalies, including:
- Cascading Effect of Tax
- State-wise taxes
- Various Central taxes and levies
- Complex tax rules
List of Taxes Going to Disappear
- Central Excise Duty
- Additional Excise Duties
- Excise Duty levied under the Medicinal and Toiletries Preparation Act
- Service Tax
- Additional Customs Duty, known as Countervailing Duty (CVD)
- Special Additional Duty of Customs – 4% (SAD)
- Surcharges
- Cesses
List of State Taxes to Disappear
- VAT / Sales tax
- Entertainment tax
- Luxury tax
- Taxes on lottery/betting and gambling
- State Cesses and Surcharges related to the supply of goods and services
Challenges in Business
Despite the government’s efforts to ease migration, millions of MSME businesses struggle to transition their processes. The new operational methodology must be adopted, and users need to understand its possibilities and limitations. Once the new system is operational, support and assistance from the government tax machinery become crucial. As businesses expand across the country, local advantages may diminish. While high tax rates are a concern, in the long run, competition intensifies, favouring quality products and top-notch services. This offers an opportunity to regulate the profit share enjoyed by businesses. With a transparent system, speed, efficiency, and price competitiveness in services may become predominant factors.
If existing software lacks the capability to manage both the existing tax system and GST, users must seek suitable software for their business.
A Good ERP will be the Backbone of business
Through the transparent taxation methods of GST, businesses need to invest in good ERP and accounting software to manage transactions flawlessly. It becomes necessary to upload all the purchases and sales transactions with the product and service details including the HSN Code for materials and SAC for Services into the GST website.
GST v/s Quarto
Quarto outperforms in the aspects of flexible adaptation of rules. As the product is designed to reduce the customization cost, most of the GST related requisites are fulfilled. The accounting of GST is very well incorporated in the software and is tested and ready to use. Another advantage is that the same software can manage the existing VAT system, making it usable for future needs. This means Quarto is capable of handling both VAT and GST simultaneously.
In conclusion, our exploration of ‘GST: An Outlook’ has illuminated the transformative impact of the Goods and Services Tax on the Indian economy. We’ve examined its current state, offered valuable insights, and provided an analysis of its implications, emphasizing the necessity of having a good ERP software for business. As we move forward, understanding the evolving ‘outlook of GST’ will be essential for businesses and individuals alike. Thank you for joining us on this journey through the world of taxation.
Get in touch with us to discover the importance of having Quarto ERP for your business.
