Key Aspects of GST

Key Aspects of GST;
The much awaited good and service tax subsumes multiple indirect taxes such as excise duty, service tax, VAT, along with local tax( eg octroi). under old regime companies were subject to maze of taxes at the central , state& city level that varied substantially from state to state and different stage of the product cycle. the sheer complexity involved in ascertaining differen taxable values/classification standards etc has resulted in large compliance cost,high consumption taxes and recurring legal disputes/tax claims.

🔑Points;

1 rate recommended by CEA pannel;
The chief Economic Advisor pannel has suggested a three tier taxation structure with low rate of 12% for essential goods(includes gold sliver precious metals), standard rate of 17-18% and rate of 40% for luxury negative goods and service such as expensive cat etc.  Food staples for the poor are unlikely to be under Gst. Liqour , petroleum and cigar are not under Gst purviews as of now.

👉🏻 Tax compliance to improve ;
with GST the tax will target final consumption on a national scale, with stage of production and distribution being viewed as pass throughs. thus tax compliances is likely to improve significantly. since ever link in value chain will require proof of compliance by the prior link to claim the required offsets.
👏  Primary positive impacts;
1 lower tax across most segements.
2. Rationalisation of national warehousing leading to lower logistic cost.
3. Reduced time to market .
4. Narrow price differential between organized and national players and regional unorganized players.
5. Increase in ease of doing business.
6. Wider tax base higher tax compaliance.

💰💰Companies to Monitor ;

1 . Asian paints Berger paints pidlite cera, HSIL, somany,
2. jubliant foods , West life development.
3. Bata , relaxo , Liberty.
4. century ply, Green ply.
5. amara raja, exide.
6. Bajaj electrical, Havells.
7. sympony , Voltas, bluestar.
8. Pvr, inox-Direct beneficiary Eros, UFO