Where is the Indian economy heading?

Where is the Indian economy heading?

Is the World Bank report creating a further dilemma about the nation’s

stand on GST?

The whole of India, right from lawmen to lay men all have got their eyes fixed on GST. GST has become the talk of the town and common household name. Though GST is believed to have its own benefits a large number of people find it hard to adopt the provisions and principles of GST. For the ones who do not know, the GST system was first implemented in France where the whole country goes under one tax system, while countries like Brazil, Canada etc follow Dual-GST. India chose to follow the Canadian method of taxation and is employing Dual-GST.

Many people do not understand the reason behind the increase in tax rates. Tax rates that earlier came under different heads like VAT, CST, Excise duty and approximately 15 other heads are now coming under the same head GST. The ‘one nation, one tax’ initiative is something that many nations have been following so adoption of the same will not be trouble but real trouble will rise only when the nation doesn’t implement it rightly. That is where things might lose track and fall apart. The sufferer will be the end client or simply call him the consumer, retailers and other service providers do not consumer enjoy their benefits under GST. While there is all this panic and mayhem, a report released by the World Bank comes as a thunder shock as India loses its face on the Global platform.

Where is the Indian economy heading?

World Bank’s ‘Doing business’ report:

World Bank has now released a report that ranks all the nations based how they carry out business reforms. The report is taken based on 10 different parameters including paying taxes, trading across the border, starting business ventures and much more. India is placed in the 172nd position out of the 190 nation in the ‘Doing business’ report on the ‘paying tax’ basis and takes the 130th position in the ‘ease of doing business clause. For a developing nation like India 172nd position is quite disheartening.

However, India (or specifically the ruling government) has a different take on this. An official of the Commerce and Industry Ministry says that World Bank has not taken into consideration the numerous initiatives taken by the ruling government to promote trade, to improve the relationship between India and other nations and most importantly the ‘Make in India’ initiative. India is also not happy with the sample size that was taken for analysis. While the sample size was small for other nations, it was quite large for India. India had to bag a very low place in the tax index because the VAT payment and refund mechanisms were not taken appropriately by the World Bank.

Despite the center trying to justify that the report released by the World Bank does not reflect the true and fair view of the nation, the reports of the World Bank cannot be completely ignored. If something as unavoidable as VAT has payment issues in the past, how will the nation have a strong hold on GST payments is still a matter of concern.

Leave a Reply

Your email address will not be published. Required fields are marked *