The GST has been around for a while now, but still it seems as if the clarity regarding the bill is very little. So we thought we will deconstruct the bill based on the sector you work in. Let’s go!
The Good: GST will bring major change and uniformity in businesses. Taxes could go down by 2-4%.DTH, film producers and multiplex players are levied service tax as well as entertainment tax, GST will bring major change and uniformity in businesses.
Multiplex chains will save on revenues as there will be a more uniform tax, unlike current high rate of entertainment tax levied by different states.
The good: As per a report by Motilal Oswal Securities, On-road price of vehicles could drop by 8%. Lower prices can be made out to be an indirect stimulus to boost volumes of sales.
The bad: Demand for commercial vehicles may be hit in the medium term.
The Bad: Insurance policies: life, health and motor will cost more from April 2017 as taxes will go up by up to 300 basis points. (Ouch!)
The Good: GST will eliminate multiple levies. It will also allow deeper penetration of digital services.
The Bad: With GST, companies might require each centre to generate a separate invoice to every contracting party. Duty on manufactured goods is going to go up from existing 14-15% to 18%, which means the cost of electronics from mobile phones to laptops is bound to go up.
The Good: FMCG companies pay nearly 24-25% including excise duty, VAT and entry tax. GST at 17-19% could yield significant reduction in taxes.
The bad: If the recommended 40% GST for aerated beverages and tobacco products is levied, then the prices may go up by over 20%.
Take a look at how GST will impact the common man w.r.t the price of the commodities.
The Good: GST will create a single unified market across India and allow free movement and supply of goods in every part of the country.It will also get rid of the cascading effect of taxes on customers, which will boost the efficiency in product costs.
The Bad: Tax collection guidelines requires additional documentation will increase workload for eCommerce firms and push up their costs.
The Good: For handset makers, GST will bring in ease of doing business as they may no longer need to set up state specific entities and transfer stocks to them and invest heavily into logistics of creating warehouses in each state across the country.
The Bad: Call charges, data rates will go up if tax rate in the GST regime exceeds 15%.