Snippets

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Military Sector

GST would also benefit the military sector. Not only are there high-costs involved in the procurement of raw materials in making of armaments, but a lot of economic logistical losses are suffered by the manufacturers by unnecessarily disposing spare unused parts. GST would help this sector by levying tax only once at the point of consumption and no further.

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Youth Development

Though the existing tax officials will be familiarized with GST, employment opportunities will also increase. Even now, many start-ups have come up with simpler and user-friendly websites and software for GST related compliance. The removal of multiple tax rates will turn India into one national market thereby increasing demand. To meet the demands, the industries will have to expand and this, in turn, will create more jobs. GST Edge has its own multi-purpose, multi-platform, easily accessible products such as Registrations, Returns and Invoicing.

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Youth Empowerment

One of the major change that GST will bring is the organization of the unorganized sector. Employment in the organized sector is going to be better than employment in the unorganized sector. The E-Commerce service providers will have to get registered in each state if they want to sell their wares in that state. This will lead to job creation in the e-commerce sector which is already booming.

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Education

Education is an essential part of the country’s economic progress and a priority for the Government. It therefore enjoys many tax advantages and different concessions in direct as well as indirect taxes. Academic services (excluding coaching) are presently included in the Negative list. Education will continue to be out of the service net tax under GST as the Government doesn’t want to give any major shocks in the first year of roll out (demonetization’s shock will suffice for a while).

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Healthcare

Healthcare will not come under GST net. It is no secret that many times, people die due to the absence of medical care. The reasons may differ – sometimes hospitals are miles away, doctors are on strike, the costs are too high, the medicines are unaffordable – the outcome is the same. Healthcare was exempt from taxes under the previous tax structure and will continue to be so even after GST is imposed. Making healthcare and medicinal drugs affordable has long been the goal of the Indian Government. Therefore, for the time being, healthcare will remain out of the tax net.

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Affordable Medicines

Medicines are often very costly depending on the ailment. This deters many middle-class people from buying medicines for treatment or switch to cheaper alternatives that have lesser impact. With GST less than 75 days away, we have more reason to cheer. GST is going to replace 8 taxes that are currently levied on pharmaceuticals and it is expected that the manufacturing costs will reduce and production costs will come down by 2%. This will add to about 20% profit and consequently bring down the prices for consumers. The discontinuances of Central Sales Tax (CST) is also going to be a major advantage.

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Pepsicola

Aerated drinks have been classified as demerit goods and so will attract a sin tax of 28% along with an additional cess of 15%. This ‘Sin’dulgence will cost you a little more than the excess sugar in your blood stream.

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Food

You will witness even more of the teenager’s frisky behaviour in multiplex corner seats. Entertainment tax will be subsumed into GST thereby bringing down ticket prices.

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Brands

If Gucci and Prada had been out of our reach now, you can expect them to be more so in the future. Although a lower rate of 12% is expected, the sector will end up paying higher duties.

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Dairy Products

VAT on ghee, butter and tetra packed milk is between 5-7%. Dairy products will fall under FMCG and will be taxed at 12%.

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Agriculture

Raw agricultural commodities such as wheat and grains will remain exempt from tax whereas processed commodities shall be taxable. Hence all farmers won’t be liable to pay GST although produce buyers may need to collect the tax on a reverse charge basis.

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Alcohol

GST will-hopefully- bring relief from dual administrations for Alcohol vendors/suppliers but at the same time bring up production costs and consumer prices which would impact sales.

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Quick Service Restaurants

It’s quite possible that a famous Quick Service Restaurants whose ice cream machines are always broken would be falling short of fries as well. Burgers chains which give contracts for potato farming will be brought under the ambit of GST as the government declares contractual farming as taxable.

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Cellular Networks

The curve-ball named Jio had already wrecked other telecoms customer base. With GST on the way, tax rates will probably go up from the current 15% to 18%. Now it remains to be seen whether karma exists and if Jio sees a shift in its customer towards its counterparts.

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Synthetic Fiber

The next time you’re at Nike or Adidas’ Factory outlet, don’t feel shy to buy your favourite jerseys in bulk. Man made fibres such as nylon, rayon, polyester fibre will be affected positively if a GST of 12% is levied.

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Shopping

Shopaholics will face withdrawal as textile costs are likely to shoot up. GST of 12% would be costlier for assesses as opposed to the current tax which amounts to 6-7.2% (1.2% excise duty+ 5-6% VAT).

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Automobiles

The automobile sector is going to be the biggest beneficiary under GST. Currently taxed at 27% a standard rate of 18% is going to be levied under GST. Road tax is not going to be merged under GST but a 9% drop in tax rates still sounds good.

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E-commerce

E-commerce giants like Amazon and Flipkart may not entirely be in favour of GST as the administrative costs are expected to go up once GST is levied. The tax collection at source (TCS) guideline under GST will increase the administration and documentation workload for eCommerce firms.