In simple terms, this would mean that tax need not paid at each stage of manufacturing and retailing, but only at the destination.
Over 1,200 items, from shampoo to tea to automobiles, have been put in four broad tax categories. The Centre has already come out with a price list of commodities. Rough diamonds will be taxed at 0.25 percent rate and gold at 3 percent. "We are deciding India's future course", the Prime Minister said.
At the stroke of midnight, Mukherjee and Modi pressed two buttons on a glass box decorated with orchids and GST inscribed on it. Among others, it will make a powerful impact on the electronic goods industry as well. IT companies began launching GST-enabled solutions for its customers to help them prepare for the radical change. Inflationary pressures too have been noticed on prices, particularly when GST rates have been higher than before. It has been declared that the committee will be formed by officials of the central and state revenue departments.
Many do not even have a computer to register on the GST network. "It will propel job sector attain an annualized growth rate of 10-13% and fuel demand for professionals in various segments of the economy", Sumit Sabharwal, Managing Director (India & SAARC), Excelity Global, said in a statement. The GST Council was a unique experiment under the Indian Constitution because of the shared sovereignty.
Anwar said his party was attending the GST launch as it had supported the legislation on ushering in the new indirect tax regime in the country.
Here's a quick look at some updates ahead of the launch. All states along with Centre discussed new taxation system for years. However, Congress has made a decision to boycott it.More news: Critics call for Amazon - Whole Foods deal to be blocked
Gandhi also said: "Unlike demonetisation, GST is a reform that Congress has championed and backed from the beginning".
While the debate goes on, the tax reform is in for sure.
The GST Bill was originally piloted by Mukherjee when he was finance minister in the previous UPA regime in 2011.
First proposed in 2003, the idea of GST was bogged down for years in bipartisan debate, with political parties in government trying to push it and those in opposition dragging it down.
Hours before the midnight launch, the GST Council - the highest decision making body that formulated the rules and tax rates, met for the 18th time.
"For small businesses, we have composition scheme". One can not thus rule out job losses and panic reactions in this segment. It is now going to go up to the 18% slab after GST implementation. This should widen the tax net, shoring up public finances. But one state, Québec, imposes its own state-level taxes. Already, there are concerns among small businesses about the transition process. I remained confident that GST was only a matter of time. Once GST comes into effect from 1st July, cost of infrastructure is expected to increase. Many of them may choose to shut shops resulting in job losses.
"The implementation of GST, heralding a new era in tax reforms, would impart much needed competitiveness to Indian exports with initial hiccups".