The Indian Wire » News » GST leads to Domestic Savings of Rs 320 per month: Analysis
Business News

GST leads to Domestic Savings of Rs 320 per month: Analysis

According to an analysis of consumer expenditure data released by the Finance Ministry, an average Indian household saves up to Rs 320 per month on the purchase of common goods after the rollout of GST.

The GST came into effect from July 1, 2017, through the implementation of 101st Amendment of the Constitution by the government. GST replaced 17 multiple cascading taxes levied by the central and state governments.

The uniform tax rates on goods and services have turned India into one market. Also, it has helped the consumer to get rid of tax-on-tax (also called cascading effect).

Before the GST rollout, the Centre levied excise duty and the state governments charged  VAT, both of which were borne by the customer.

But with the introduction of GST, the cascading effect has been eliminated. Tax is levied only at the consumption end.

According to the sources, the subsequent lowering of GST rates on the commonly used goods and services has resulted in considerable monthly savings for consumers.

A comprehensive comparison between the household expenditure pre- and post-GST reveals that tax has come down on around 83 items — including food and beverages, hair oil, toothpaste, soap, washing powder, and footwear.

On a monthly expenditure of Rs 8,400, GST paid is Rs 510. Before the GST, the tax paid was Rs 830. Thus, you save Rs 320.

 

Reach out to The Indian Wire!

Want to work with us? Looking to share some feedback or suggestion? Have a business opportunity to discuss?

You can reach out to us at [email protected]




Like us on Facebook!