India’s ‘simplified’ tax scheme is anything but simple
Twenty-nine disparate states are now working under the same, centralised Goods and Services Tax, but most seem ill-prepared for the tidal wave of economic disorder it seems likely to bring
Now the prime minister, Modi has had a change of heart, launching the GST regime throughout India in his characteristically ostentatious style, at a midnight event at the Central Hall of the Parliament of India – the same venue and time when India declared independence from the British 70 years ago.
In a short span of six years, Modi has gone from being the one-man roadblock to the GST to celebrating its launch in the grandest manner since Indian independence in 1947.
India’s GST initiative is a mammoth exercise in fostering a tax union across all its 29 states. Previously, each state levied its own taxes and surcharges.
The GST aims to implement five uniform tax rates across all of India. The idea is that a simplified tax structure will reduce friction and boost interstate trade and commerce, providing a fillip to the overall gross domestic product.