In recent days, GST is regarded as a boost to the competitiveness and performance level in the sector of manufacturing in India. The decrease in advanced infrastructure and export are the major concerns for sectors of manufacturing today. Previously, there were various types of indirect taxes leading to an increase in the administrative cost and operating expenses during the process of manufacturing and distribution.
There are different industries under GST. Some of the Industries or Sectors under GST have been discussed below:
After GST implementation, the compliance burden related to multiple taxes has been eliminated, and accordingly, the sectors such as retails, manufacturing, distribution have also grown significantly. However, the businesses that come under tax slabs in the previous tax regime now have to mandatorily get themselves registered under the GST regime, Ultimately, it leads to lessening of tax evasion.
A survey conducted in March 2014 reveals that there are around 12, 76,861 service taxpayers in India out of which 50 of them are paying 50% of the tax collected all over the country. According to the analysis, the main burden that is borne by various domains includes telecommunications, information technology services, business support services, insurance, finance and banking services, etc.
In a populated and vast country like India, the industry of logistics is regarded as one of the essential factors contributing to the Indian economy. Fairly, this can be assumed as a well-organized and well-structured logistics industry that has the potential to keep track of changing requirements of the economy of a country. This also includes the Make in India Program an Indian Government initiative.
In recent years, with rapid growth in technology, the industry of e-commerce in India has been emerging as a game-changer for the Indian economy. The GST implementation will help the aforesaid sector in so many ways for the long-term success and growth of an economy as suggested under GST law. GST law provides the mechanism of Tax Collection at Source (TCS) that will be advantageous for companies engaged in e-commerce business. Presently, the rate of TCS is 1%.
While analyzing the impacts of GST on the Pharma industry, it came to light that GST ensures to create a boost in the medical tourism and generic drug maker in the pharma industry, Ultimately, GST helps for the simplification of the tax structure. Presently, the hopes of the pharma sector for tax respite and the same can make it easier, affordable, and cheaper for services of healthcare that can be accessed by income groups in India.
The telecom sector price will ultimately come down after GST implementation. The aforesaid theory was predicted by experts and scholars before the GST implementation. In the telecom sector, the manufacturer has the opportunity to save additional costs or expenses with effective and efficient stock management by warehouse consolidations. The handset manufacturer can supply the goods easily as GST has made it compulsory for businesses engaged in the supply and transfer of goods to get registered under GST. Apart from that, while doing this the business owners will also discover a way of cost-saving related to logistics.
The textile industry in our country has been engaged in employing a large population that included both skilled and unskilled laborers in the country. The textile industry's contribution is around 10% of the total annual exports of India. The aforesaid value has been on rising after GST implementation. The value of cotton in the textile industry can be impacted under GST. Ultimately, this will also impact both small and medium enterprises as it was attracted previously 0% central excise duty.
The real estate sector is considered one of the most prominent and essential sectors in India for employment generation. This sector mainly depends on the tax rates and it ultimately affects GST. However, the GST implementation, the aforesaid sector advantaged in so many ways as GST has provided the needed transparency and accountability in the business of the real estate.
The agricultural sector is regarded as the largest contributor to the overall GDP (Gross Domestic Product) of India. In India, agriculture covers around 16% of the Gross Domestic Product. The important problem that is faced by the agricultural sector is the overall transportation cost all over India. GST has played an important role to resolve the issue of transportation in the agricultural sector.
The FMCG sector has been witnessing significant changes in the industry as companies working as FMCG businesses are saving the cost of logistics and distribution after GST implementation. GST has significantly eliminated the need for more than one depot of sales.
In India, today freelancing has been growing at a faster pace. However, it is to be noted that the rules, guidelines, and provisions of the freelancing industry are still dependent upon GST. With GST implementation, it became easier for freelancers for filing the tax returns easily and they can do so by sitting at home through online mode. Freelancers are taxed under the category of service providers; the tax structure of the country has been accountable and transparent on the part of the freelancing industry under the tax regime of GST.
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