What difference will GST Bill make now?

by Gunjan Mohan Posted on

India is finally getting the GST – a historic once in a generation revamp of systems. It reduces the massive heterogeneity of how different states tax products and services, and streamline tax compliance, which in turn can lead to less corruption and more development.


India is one of the hardest places in the world to do business. Indian entrepreneurs would rather buy/start businesses in distant places like San Francisco, London or Singapore, rather than in India with much larger markets, much cheaper labor and much more familiarity. If you want to be honest, life becomes exceptionally hard.

Goods & Services Taxes law will now reduce that difficulty a bit, and thus will help more entrepreneurship and bring more people out of poverty. Again, it is not a magic wand, but can be one brick in the overall rebuilding of India.

Many businesses see India as a the land where they die by confusion. There are a slew of taxes [VAT, local sales tax, central sales tax, service tax, octroi, cess, excise] that makes it very hard to move goods & do business. Since it is very hard to follow rules, most companies take shortcuts, leading to more corruption. It is not like these entrepreneurs and their employees are evil [most are good in their private lives], but see there is no way to get job done the straight way.

The first act to reduce corruption is to make it easy to follow rules. If the rule following becomes easy and painless more will be following the rules and there will be less corruption and more development.

Let us try to have one tax – very transparent to understand, very easy to comply, very easy to pay and impossible to avoid. That can help India get strong. If you are happy and you know it, clap your hands 😉

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Gunjan Mohan

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