GST Completes Eight Years: 'Good For Govt, And For Business'

(MENAFN- Live Mint) New Delhi: With 15 million registered taxpayers and robust growth in the revenue receipts, the Goods and Services Tax (GST) ecosystem is continuing to evolve with a focus on ease of doing business, better compliance and wider economic participation, the finance ministry said on Monday as the indirect tax system completed eight years.

Annual revenue from GST, introduced on 1 July 2017, has doubled to ₹22.08 trillion in FY25 from five years ago and micro, small and medium enterprises are finding easier access to credit, the ministry said. In FY21, the combined Central and state GST revenue collection was ₹11.37 trillion.

The ministry's emphasis on ease of doing business, compliance and wider economic participation comes at a time Central and state governments are preparing for reforms in the GST architecture by reducing the slabs and reallocating goods and services, which are on the 12% slab, to 5% and 18%.

The move is expected to simplify the rate structure and address anomalies such as certain raw materials and intermediate products facing a higher tax burden than the finished products.

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GST has brought major relief to micro, small and medium enterprises, the ministry said adding the tax regime had opened doors for easier access to credit.

The ministry said that TReDS or Trade Receivables Discounting System-online platforms where small enterprises can sell their unpaid invoices to banks to get quick cash-have helped improve access to credit by these businesses.

More than 5,000 buyers and over 53 banks and 13 non-banking finance companies are registered as financers on the four TReDS platforms in the country.

The GST regime delivered substantial progress in integrating markets, enhancing compliance, and leveraging digital tools for administration and enforcement but the journey ahead demands a renewed focus on simplification of the tax structure, ensuring stability in policies and building deeper trust among all stakeholders, PricewaterhouseCoopers said on Monday in a review of the tax system.

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The next phase of GST must prioritize rationalizing rates, reducing blocked tax credits, broadening the tax base and removing procedural bottlenecks, the consulting company said.

Experts said the industry is looking forward to GST appellate tribunals being operationalized for quick resolution of disputes.

The changes in the tax system so far have played a crucial role in reducing litigation and simplifying procedures. However, the wait for a functional GST appellate tribunal continues, said Manoj Mishra, tax controversy, management leader, Grant Thornton Bharat.

“While the structure is now in place, its effectiveness will depend entirely on how efficiently it is implemented. Broader issues like rate rationalization and inclusion of petroleum products remain on the table. As we look ahead, the journey is far from over, but the direction is right and the momentum isbuilding,” said Mishra.

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