A

PROJECTREPORT
ON
AN ASSESSMENT OF THE EFFECT OF GST ON THE PRIVATE
TRANSPORT
SECTOR IN INDIA.
AT
PRYDO
HYDERABAD
Submitted by
(G.Manila)

(HT.No.1424-19-672-091)

Project submitted in partial fulfillment for the award of the degree of

MASTER OF BUSINESS ADMINISTRATION

Department of Business Administration

ST.PIOUS XP.G(MBA) COLLEGE FOR WOMEN

Snehapuri colony, Nacharam, Hyderabad, Telangana

(Affiliated to Osmania University)

2020-2021
 DECLARATION:

I hereby declare that this project work is entitled “ASSESSEMENT OF THE EFFECT
OFGST ON PRIVATE TRANSPORT SECTOR at MENTORMIND submitted to
Osmania University, HYDERABAD is a bonafied work which I have executed under the
guidance of MR. pardasaradhi sir, Head Department of Business Management,St. Pious X
Degree & PG College for Women, Nacharam and this work is submitted in thepartial
fulfillment of the requirements for the award of Degree of Master of Business Administration
and this work have not been submitted to any other University or Institute for award of any
degree.

Place: Nacharam

NAME: GORANTA MANILA

Date:

H.T.NO: 1424-19-672-091
 ACKNOWLEDGEMENT:

In the accomplishment of this project successfully, many people have best owned upon me
their blessings and the heart pledged support, this time I am utilizing to thank all the people
who have been concerned with this project.

Primarily I would thank god for being able to complete this project with success. Then I
would like to thank my HOD mrs. Latha mam and mentor gudie teacher Mr. pardasaradhi sir
and also mentor mind guide MR. prakirtivaliveti sir, whose valuable guidance has been the
ones that helped me patch this project and make it full proof success. His suggestion and
instructions have served as the major contributor towards the completion of the project.

Then I would like to thank my parents and friends who have helped me with their valuable
suggestions and guidance has been very helpful in various phases of the completion of the
project.

Last but not the least I would like to thank my classmates who have helped me a lot.
 ABSTRACT

The most common road vehicle is the automobile; a wheeled passenger vehicle that carries its
own motor. Other users of roads include buses, trucks, motorcycles, bicycles andpedestrians.
As of 2010, there were 1.015 billion automobiles worldwide. Road transport offers a complete
freedom to road users to transfer the vehicle from one lane to the other and from one road to
another according to the need and convenience. This flexibility of changes in location,
direction, speed, and timings of travel is not available to other modes of transport. It is
possible to provide door to door service only by road transport. India is the second fastest
growing services sector with its compound annual growth rate at 9%.
Services constitute major portion of India's GDP with a 57% share in GDP at factor cost. Over
the past several years, significant progress has been made to improve the service tax structure,
broaden the base and rationalize the rate to pave way for GST. The most commonly used form
of goods transport in India is via road. The data from National Highways Authority of India,
about 65% of freight and 80% passenger traffic is carried by the roads. Under GST,

GST ONPRIVATE TRANSPORTATION SECTOR : ASTUDY Abstract The most common

road vehicle is the automobile; a wheeled passenger vehicle that carries its own motor. Other
users of roads include buses, trucks, motorcycles, bicycles and pedestrians. As of 2010,there
were1.015 billion automobiles worldwide. Road transport offers a complete freedom to road
users to transfer the vehicle from one lane to the other and from one road to another according
to the need and convenience. This flexibility of changes in location, direction, speed, and
timings of travel is not available to other modes of transport. It is possible to provided or to
door service only by road transport .India is the second fastest growing services sector with its
compound annual growth rate at9%. Services constitute major portion of India’s GDP with a
57% share in GDP at factor cost. Over the past several years, significant progress has been
made to improve the service tax structure, broaden the base and rationalize the rate to pave
way for GST. The most commonly used form of goods transport in India is via road. The data
from National Highways Authority of India, about6 5% of freight and 80% passenger traffic is
carried by the roads. Under GST, Key Points: private transport, Road transportation, freight,
service, GST.
The Goods and Services Tax (GST) is a value added tax to be implemented in India, the
decision on which is pending. GST is the only indirect tax that directly affects all sectors and
sections of our economy. Ignorance of law is no excuse but is liable to panel provisions,
hence why not start learning GST and avoid the cost of ignorance. Therefore, we all need to
learn it whether willingly or as compulsion. The goods and services tax (GST) is aimed at
creating a single, unified market that will benefit both corporate and the economy. The
changed indirect tax system GST-Goods and service tax is planned to execute in India.
Several countries implemented this tax system followed by France, the first country
introduced GST.
 TABLEOFCONTENT

PAGE
CONTENT
CHAPTER NUMBER

Chapter-1. 1-9
INTRODUCTION

1
1.1 INTRODUCTION TO THE STUDY

5
1.2 NEED FOR THE STUDY

5
1.3SCOPE OF THE STUDY
6
1.4 OBJECTIVES OF THE STUDY
7
1.5 RESEARCH METHODOGY

9
1.6 LIMITATIONS OF THE STUDY

Chapter-2. 10-11
REVIEW AND LITERATURE

Chapter-3. 12-72
COMPANY PROFILE

Chapter- 4. 73-92
DATA ANALYSIS AND INTERPATION

FINDING, SUGGESTION AND 93-98

Chapter- 5.
CONCLUSION

Chapter- 6. BIBLIOGRAPHY 99

Chapter-7. APPENDIX 100-104

 LIST OF TABLES

1 3.1 GST rate worldwide 44

2 3.2 Subusuming of Existing Taxes 44

3 3.3 Structure of GSTN 52

4 3.4 GST Tax Rates on some common items 56

5 4.1 Gender 73

6 4.2 Age 74

7 4.3 Current employed 75

8 4.4 Income 76

9 4.5 Educational qualifaction 77

10 4.6 The private transport services has increased 78

implementation of GST

11 4.7 The tax amount of service/on the bill and more of 79

the implementation of GST

12 4.8 GST will abolish all the direct tax levied in india 80
of the

13 4.9 The following tax will be abolished by the GST 81

14 4.10 Which system do you think is more benefical to 82

government and people

15 4.11 Information about which is more benefical to 83

government and people

16 4.12 The tax system is all about balance between min 84

compliance cost and max the GST
17 4.13 on a scale of 1to5, how much do you support 85
GST on the private transport sector of the

18 4.14 Is GST only applicable in india 86

19 4.15 How do you get to know about GST 87

20 4.16 Private transport sector can be benefitted from 88

GST

21 4.17 IS GST applicable on private transport sector 89

22 4.18 what is the percentage of GST on the private 90

trasnsport

23 4.19 What service of transportation of the goods is 91

exempt

24 4.20 Is a GTA goods Transport liable to register 92

 LIST OF CHARTS

S.no Chart TITLE OF THE FIGURES PAGE

no NO

1 4.1 GENDER 73

2 4.2 AGE 74

3 4.3 CURRENT EMPLOYMENT 75

4 4.4 INCOME 76

5 4.5 EDUCATIONAL QUALIFACTION 77

6 4.6 The private transport services has 78

increased implementation of GST

7 4.7 The tax amount of service/on the bill 79

and more of the implementation of
GST

8 4.8 GST will abolish all the direct tax 80

levied in india of the

9 4.9 The following tax will be abolished by 81

the GST

10 4.10 Which system do you think is more 82

benefical to government and people

11 4.11 Information about which is more 83

benefical to government and people

12 4.12 The tax system is all about balance 84

between min compliance cost and max
the GST

13 4.14 Is GST only applicable in india 86

14 4.15 How do you get to know about GST 87

15 4.16 Private transport sector can be 88

benefitted from GST

16 4.17 IS GST applicable on private transport 89

sector

17 4.18 what is the percentage of GST on the 90

private transport

18 4.19 What service of transportation of the 91

goods is exempt under GST of the
respondent

19 4.20 Is a GTA goods Transport liable to 92

register
 LIST OF GRAPHS

S.NO GRAPH NO. TITLE OF THE GRAPHS PAGE NO.

on a scale of 1to5, how much do

1 4.13 you support GST on the private 85
transport sector of the
 LIST OF FIGURES

S.NO CHART NO TITLE OF THE FIGURE PAGE

NO

1 1.1 Source of data 8

3 3.1 Format of GSTIN 49

4 3.2 GST Number Search Tool 50

5 3.3 GST Rates for Goods 57

6 3.4 GST Rates for Services 62

 CHAPTER1
INTRODUCTION

1.1INTRODUCTION:-

GST(GOODS AND SERVICES TAX)

Goods and Services Tax (GST) is an indirect tax (or consumption tax) used in india on
thesupply of goods and services. It is a comprehensive, multistage, destination-based tax:
comprehensive because it has subsumed almost all the indirect taxes expect a
statetaxes.Multi-staged as it is,the GST is imposed at every step in the production process,
but ismeant to be refunded to all parties in the various stages of production other than the
finalconsumer and as a destination-based tax, it is collection from point of consumption and
notpoint oforiginlikeprevious taxes.

Goods and Services are divided into five different tax slabs for collection of tax – 0%, 5%,
12%, 18% and 28%. However, petroleum products, alcoholic drinks, and electricity are not
taxed under GST and instead are taxed separately by the individual state government, as
perthe previous tax system. There is a special rate of 0.25% on rough precious and semi-
precious stones and 3% on gold. In addition cess of 22%or other rates on top of 28% GST
applies on few items like aerated drinks, luxury cars and tobacco products. Pre-GST, thes
tatutory tax rate for most goods was about 26.5%, post-GST, most good sare expected to be
in the 18% tax range.
The tax came in to effect from 1july 2017 through the implementation of the one Hundred
and First AmenCdment of the Constitution of India by the Indian government. The GST
replaced existing multiple taxes levied by the central and state government.
The tax rates, rulesand regulations are governed by the GST Council which consists of
thefinance ministers of the central government and all the states. The GST is meant to replace
aslew of indirecttaxeswith afederatedtaxand isthereforeexpectedtoreshapthe
country’s 2.4 trillion dollor economy, but its implementation hasreceived criticism.
Positiveoutcomes of the GST includes the travel time in insterstate movement, which
dropped by20% because of dis banding of interst at echeck posts.

1
What is GST in India?

GST is know as the goods and services Tax. It is an indirect tax which has replaced many
indirect taxes Indian such as the excise duty, VAT, services tax, etc. The Goods and
services Tax Act was passed in the parliament on 29th March 2017 and came into effect on
1st July 2017.

GST RETURN:

A return is a document containing details of income which a taxpayer is required to file with
the tax administer ativeau thorities. This is used by tax authorizes to calculate tax lablility.

Under GST, are glistered dealer has to file GST returns that include:

• paidonpurchasespurchase
• sales
• outputGST(onsales)
• inputtaxcredit (GST)

To file GST returns or GST filing, GST compliant sales and purchase invoices are
required.You cangenerate GSTcompliant invoices for free on clear tax billbook.

GSTCalcultor:

Calculating the amount that needs to be paid as GST when filing your returns can be
quitetedious. A number of aspects and factors must be taken into consideration, such as ITC,
exempted supplies, reverse charge, etc. Failure to pay the entire GST amount can see
youslapped with an 18% interest on the shortfall, thereby making it necessary to ensure that
you pay theright amount to wards GST.
The GST Calculator makes it relatively simple for taxpayers to calculate the amount that
needs to be paid as GST.You will have to enter all the required details such as the month for
which you are calculating GST, the due date for filing returns for the particular month, the
actual date on which the returns are filed, the tax liability for the month, the purchases that
attract Reverse Charge Mechanism, the opening balance of your cash ledger as well as your
creditled gerand the eligible ITC.

2
Revenue Distribution:

Revenue earned from GST (intra state transaction - seller and buyer both are located insame
state) is shared equally on 50-50 basis between centraland
Respective state governments. Example: if state of Goa has collected a total GST revenue
(intra state transaction - seller and buyer both are located in same state) of 100 crores in
month of January then share of central government (CGST) will be 50 crores and remaining
50 crores will be share of Go a state government (SGST) for month of January. For
distribution of IGST (inter state transaction - seller and buyer both are located in different
states) collection, revenue is collected by central government and shared with state where
good is imported Example: 'A' is a seller located in state of Goa selling a product to 'B' a
buyer of that product located in state of Punjab then IGST collected from this transaction will
be shared equally on 50-50 basis between
central and Punjab state governments only.

GST Council:
GST Council is the governing body of GST having 33 members, out of which 2 members are
of centre and 31 members are from 28 state and 3 Union territories with legislation. The
council contains the following members (a) Union Finance Minister (as chairperson) (b)
Union Minister of States in charge of revenue or finance (as member) (c) the ministers of
states in charge of finance or taxation or other ministers as nominated by each states
government (as member). GST Council is an apex member committee to modify, reconcile
or to procure any law or regulation based on the context of goods and services tax in India.
The council is headed by the union finance minister Nirmala Sitharaman assisted with the
finance minister of all the states of India. The GST council is responsible for any revision or
enactment of rule or any rate changes of the goods and services in India.

Implementation:
The GST was launched at midnight on 1 July 2017 by the President of India, and the
Government of India. The launch was marked by a historic midnight (30 June – 1 July)
session of both the houses of parliament convened at the Central Hall of the Parliament.
Though the session was attended by high-profile guests from the business and the
entertainment industry including Ratan Tata, it was boycotted by the opposition due to the
predicted problems that it was bound to lead for the middle and lower class Indians. The tax
3
was strongly opposed by the opposing Indian National Congress. It is one of the few mid
night sessions that have been held by the parliament - the others being the declaration of
India's independence on 15 August 1947, and the silver and golden jubilees of that occasion.
After its launch, the GST rates have been modified multiple times, the latest being on 22
December 2018, where a panel of federal and state finance ministers decided to revise GST
rates on 28 goods and 53 services.
Members of the Congress boycotted the GST launch altogether. They were joined by
members of the Trinamool Congress, Communist Parties of India and the DMK. The parties
reported that they found virtually no difference between the GST and the existing taxation
system, claiming that the government was trying to merely rebrand the current taxation
system. They also argued that the GST would increase existing rates on common daily goods
while reducing rates on luxury items, and affect many Indians adversely, especially the
middle, lower middle and poorer income groups.

4
THE NEEDS , SCOPE & OBJECTIVE OF AN ASSEMENTOF THE
EFFECT OF GSTONTHE PRIVATE TRANSPORT SECTOR IN INDIA

1.2NEEDFOR THESTUDY:

 The purpose of this study is under the effects of GSTon the private transport sector in
india.
 The change in taxation system of a country is a significant step, and prove to quite a
tedious transition for most businesses and individuals.
 The use of private transport options in india is only growing and hence it is
extremelyImportant to understand the effect.
 GST has on this sector and on the citizens that make use of private transport options.

1.3Scopes of study:

 The scope of this study is based on the research on GST and intial effect in India, in
the cotextof the private transport sector.

 This study is based on research done within India and does not extend internationally.

 The scope of this study is based on the responses of 100 respodents and their opinions
on the effect of GST on private transport in india.

5
1.4 Objectivesofthestudy:

 To understand how GST will Indian private transport sector companies.

 Identify the growth factor which affect the private transport sector industry and its
analysis.

 To understand the benefits of GST over the current taxtation system in India.

 To evaluate the challenges of GST which private transport sector industry have to
face.

 The objectives ofthe study is to analyzethe impact of GST on various sectors of

private transport sector such as warehousing, transportation and freight forwarding
because almost 70 precent of the total spent on Private transport sector.

 To know the effect of GST in road transportation services

 To analyse the benefits and problems for impact of GST on service sector.

 In india consists transportation, warehousing and freight forwarding. To

understandconcpect if goods and services tax on private transport sector.

 To know the major benefits from the private transport sector.

 To analyse some the major management problems for private transport Sector.

 To analyse the role of GST in private transport sector.

 To know the major benefits from the private transport sector.

 To study the problem while implementing the GST

 To analyse the effect of GST on private transport sector.

6
1.5 Research methodology:

This study furnishes a precise of the research methodology used in the research of the effect
of Goods and ServicesTax (GST) to the private transport sector. Redman & Mory (2001),
defined research as systematic campaign to gain new cognition. In fact, research also is said
as an art of scientific investigation.The research methodology is the fashion to figure out the
research problem and to acquire the info systematically. It is based on the most effective
fashion to obtain useful info with a very minimum price to acquire the consequences of
aninve stigation. Besides that, it may understand as a scientific discipline of poring over how
research is done scientifically.

The aim of this study is to discourse the methods used in the research. It is also a vital
component in order to achieve the objectives of the decision, clear, accurate and reliable. In
this study we can also see the step is generally adopted to know how to collect analysis and
inter pretations of data. It covers the aspects of research contrive, research process,
population and sampling, data aggregation technique, development of instrumentation
anddata analysis adopted. The purposes of this study is to describe the research methodology,
explain the sample selection, describe the procedure used in designing the instrument
andcollecting the data, and provide an explanation of the statistical procedures used to
analyze the data.

Sample Size:

The sample size for this study is 100 respondents collected from the employees who is being
working in the private transport sector industry and who have already worked in it.

Tools and TechiquesFor The Analysis:

The basic tools that is used for conducting this survey is through the structured questionnaire,
analysing and interpreting the primary data into bar graphs, pie charts and line graphs.

The techniques which are used is two tailed test, chi square and regression to interpret the data
in the most simplest form.

7
Data Collection Method:

Data is one of the vital aspects of any research studies. Every research is based on the data
which is analyzed and inter preted to get information.There are two sources of data.
Primary data collection applies surveys, questionnaires, or direct observations. Secondary
data collection may be conducted by collecting information from a diverse source
ofdocuments or electronically stored information. In this research paper, two data collection
will be used which is primary data and secondary data collection.

Sources of Data

Fig 1.1

Primary Data:

Primary data are the data which are accumulated from the field under the control and super
intendence of an investigator. Primary data means original data that have been collected
specially for the purpose in mind. This type of data is generally a fresh and collected for the

8
first time. It is useful for current studies as well as for future studies. The collection data tool
that has been chosen in this study is Google form. Most of the previous researchers use the
questionnaire as their data collection tool in the survey. The questionnaire was administered to
a random company through Google form and email to the company. The used of questionnaire
in this study does not meddle with the daily routin eat the respondent‟s since it took them only
several minutes to answer the questionnaire. Aquestionnaire has a list of enquiries whether in
an open ended or close ended for which respondents will give an answer according to their
cognition. For this survey, the questionnaire is using the closed-ended question format, in
which case the respondent isasked to select answer on the response scale provided. an answer
from among a listprovided and fillinthe

Secondary Data:

Secondary data are the data that have been already collected by and readily available
fromother sources. Such data are cheaper and more quickly obtainable than the primary data
and also may beavailable when primary data cannot be obtained tall.There searchers will find
the secondary data when it is not possible to collect the primary data. We can acquire
secondary data based on the research that can be gained after go through certain sources such
as indicted sources that have been printed or not. Basically, secondary data provide the
research to understand more about the topic and give clearer perspective and view on the
current study.
1.6 Limitations Of The Study

Every study has certain limitations

Difficulty in data collection.

Due to constraints of time and sample respon siveness the samplesize is limited.
The information obtained from there spondent is assumed to be factual.

9
 CHAPTER 2
LITERATURE REVIEW
1. Pawan Kumar, Dilip Kumar Asian Journal of Management 11(4), 535-538, 2020
Taxation system is as old as the human civilisation. This has evolved over the ages and
Chanakya’s Arthashastra is the famous treatise on the subject of the ancient times. However,
with the regular evolution of the economic activities combined with adoption of different
forms of administration the taxation systems were bound to change. The further evolution
came with the scientific discoveries, expansion of economic activities, growth of population,
improvisation of production system samong others.The present paper as pires to look in to
the..
2. Dr Kumar Impact Of GST On The Working Of Rural India-A Study Assessing The Impacts
Of The New Indirect Taxation System On The Unorganised Business Sector in Lower Himachal
Pradesh, 2018 GST is one indirect tax for whole nation, making India one unified common market.
GST is a single tax on the supply of goods and services, right from the manufacturer to the consumer.
The study is useful to judge the impacts of the new taxation in the region, suggesting way out to
succeed the business activity.
3. Nishi Shubhita Rakesh, Shreya Nanda, Smita Mehendale Asian Joural of
Management 9(1), 829-833, 2018 The presence of social media, its impact on the consumers
and businesses, the advantages and disadvantages associated with it and the various tools and
platform which form a part of this have become a subject of interest for various studies. One
of the most important out come of this rapidly evolving social media on tourism sector is E-
Word of Mouth. More precisely, Electronic-Word of Mouth. Results of various studies
indicate that E-WoM heavily impacts the choices of the consumers when it comes to
selecting destinations and service providers
4. Abbas Valadkhani, AllanP Layton Australian Economic Review 37 (2), 125-138, 2004
This article examines the magnitude and duration of the effect of the Goods and Services Tax
(GST) on inflation in Australia's eight capital cities using the Box and Tiao intervention
analys is and quarterly data spanning from 1948:4 to 2003:1. We found that the GST had
asignificant but transitory impact on inflation only in the September quarter of 2000 when
this new tax system was implemented. In this quarter inflation showed an additional increase
of 2.6 per cent in Sydney (minimum effect) and 2.8 per cent in Australia as a whole,and the
figure for Hobart was 3.3 per cent (maximum effect). Based on Wald test results, wealso
found some evidence that there is no significant (or substantial) difference in the average

10
price changes among capital cities. We could not reject the null hypothesis that theGST
increased the consumer price studies and surveys index by 2.8 per across the board
invariouscities. These results are also consistent with previous.

5. Pushpendu Chand, Jitesh J Thakkar, Kunal Kanti Ghosh Resources Policy 68,
101726, 2020 The context of the sustainable supply chain (SSC) is progressively getting attention
among supply chain (SC ) managers due to its competitive advantage in firms' performance.
Increasing supply chain complexity (SCC) is argued as one of the biggest risks in achieving
the organisational goal with an adverse impact on operational efficiency, cost, profitability,
on-time delivery, and customer satisfaction. Though drivers of SSC and SCC have see mingly
demon strated mutual relationship in a practical scenario, supply chain managers tend to
address.

REFERENCES:
1. Pawan Kumar, Dilip Kumar
Asian Journal of Management 11 (4), 535-538, 2020.
2. Dr Kumar.
3. Nishi Shubhita Rakesh, Shreya Nanda, SmitaMehendale Asian Journal of
Management 9 (1), 829-833, 2018.
4. Abbas Valadkhani, Allan P Layton
Australian Economic Review 37 (2), 125-138, 2004.
5. Pushpendu Chand, Jitesh J Thakkar, KunalKanti
Ghosh Resources Policy 68, 101726, 2020.

11
 CHAPTER 3
COMPANY PROFILE
3.1 COMPANY DETAILS

Company Details :Prydo is a brand of VenkataPraneeth Technologies Pvt Ltd, a

techstart-up promoted by Praneeth Group, widely respected real estate company in
Hyderabad. Prydo aims to disrupt the industry by establishing itself as a global cab-hailing
serviceprovider.
Venkata Praneeth Technologies, part of the Hyderabad-based Praneeth Group, has launched
cab-hailing services under the brand ‘Prydo’ in Hyderabad.
The company has on-boarded over 14,000 driver-partners and services will for mally
commence from September29.

The ‘Prydo’ mobile application will be available in the Android Play Store and iOS App
Storefrom today. The Prydo business model ensures surge-free rides for customers and
offersdriver-partners a slew of welfare measures. Prydo will offer its services in three
categories –hatchback, sedan and SUV.

Prydo plans to expand its services to Delhi, Bengaluru and other metros, and plans to invest
Rs100 croreover the next 12 months for national expansion.

CEOOF PRYDO:

Narendra Kumar Kamaraju, Founder & Managing Director, Prydo said, “We have launched
Prydo’s cab-hailing services in the Hyderabad market and integrated the Prydo app with the
Telangana Government’s Hawk-Eye application to ensure the safety of riders. We feel the
cab-hailing industry has huge growth potential. We are hope ful of completing over one
Million rides in the next three months in Hyderabad.”

Prydo will charge a commission in the range of up to 10 per cent from driver-partners,
depending on the number of rides permonth.

The company would charge as maller or zero commission for a higher number of rides on a
monthly basis. Prydo would also ensure transparen cyinbilling and invoice systems.

12
VISION,MISSION AND VALUES

VISIONSTATEMENT:-

We aim to provide a superior quality of life to the common man by continuous improvemen
to fcore infrastructure.
MISSION STATEMENT:-

To continuously strive to develop superior infrastructure meeting the highest standards

ofengineering excellence, efficiency, quality, and economy without compromising on
ourcorporate social and environmental responsibilities.

VALUES:-

»Belief inTeamwork

»Respect for Emerging Ideas

»Passion for Learning & Innovation

»Integrity.

Users can book a particular number of (inbulk) cabs for the guests attending their functions
— Multiple pick up points to a single destination and single pick up points to multiple
destinations; return compensation – Prydo has earmarked a geo-fencing around Hyderabad
and it will compen sate the driver-partner .

13
3.2 INDUSTRYPROFILE:

The PrivateTransport Sector In India:

The Government of India recognizes the importance of theprivate sector in bridging there
source gap in investment and improving the operational and managerial efficiency in the
transport sector in order to address capacity constraints and deficiencies in the existing
transport infrastructure and meetrapidly growing demand. The Government is actively
pursuing policies to promote private sector involvement in the development of transport
infrastrure and services.
The experience in involving the private sector in transport development in India is the focus
of the paper. It provides abroad over view of government policies and various initiatives that
have been under taken to promote private participation following various models. It
alsodiscusses achievements made in different subsectors and draws some conclusions on
major policies and initivates of the Government.

INTRODUCTION:

It is universally recognized that transport is crucial for sustained growth and modernization.
A dequacy of this vital infrastructure is animportant determinant of the success of a
nation’seffort in diversifyingits production base, expanding trade and linking together
resources and markets into an integrated economy. It is also necessary for connecting villages
with towns, market centres and in bringing together remote and developing regions closer to
one another. Transport, therefore, formsa key input for production processes and adequate
provision of transport infrastructure and services helps in increasing productivity and
lowering production costs.

All sectors, including transport, operate within the socio-economic framework provided by
the State. Specific policies are designed with in the frame work for each sector in order to
Meet national goals and objectives. Currently, the main objective of development planningin
India is higher growth ingrossdomestic product (GDP).
The aim is to achieve a target of 8 per cent average GDP growth in thenext 10 years. The
higher rate of growth must also be accompanied bywider dispersal of economic activity and
has to go together with the objectives of reduction in poverty, provision of gainful and

14
highquality employment, improvement in literacy rates, reduction in the growth of
population, reduction in gender inequality in illiteracy and wage rate, reduction in infant
mortality, etc.As a service industry, transport doesnot exist for its own sake. It serves as a
means to achieve other objectives. In formulating policy for the development of the transport
sector, various macro objectives mentioned above there fore have to be taken in to account.

Some of these are economic in character while others are of a socio-political nature.
Economic and non-economic objectives are not always consistent. However, their mix is
oneof the Important factors which determines the pattern of investment and its funding
invarious sectors of economy.

Historically, transport infrastructure and services have been provided by the State.
Themassive investment requirement, longgestation period and uncertainty of return were
mainly responsible for the lack of interest by the private sector. The presence of significan
texternalities also justified the dominant role of the State in providing basic infrastructure
services. In the allocation of budgetary resources, there fore, the development of transport in
frastructure is still given high priority. However, the resource requirements for maintenance
and expansion have far exceeded the capacity of the budget. For long, the Govern menthad
contributed to the development of the transport sector.
However, over the years, protected by restrictive practices, the public

Enter prises grew in size and have operated as “natural monopolies”providing poor quality of
service at low prices. Most of them also in curred heavy losses and had to be supported bythe
Government. This has prompted the demand for liberalization to allow competition in the
sector and restructuring for privatization of public enterprises.

15
 1. RAILWAYS

Indian Railways is one of the largest railway systems in theworld. By carrying about 11
million passengers and over 1.20 milliontonnes of freight per day the rail system occupies
aunique position in the socio-economic map of the country and is considered a means and
a barometer of growth. Rail is one of the principal modes of transport for carrying long-
haulbulk freight and passenger traffic. It also has animportant role as the mass rapid transit
mode in the suburbanarea so flarge metr opolitancities.

However, there has been a continuous decline in the share ofrailways in total traffic. Its share
of the freight traffic came down from89 per cent in 1951 to less than 40 per cent in2000.
Over the same period, the share of passenger traffic came down from 68 per cent toless than
20 per cent. This decline in the share of railways has caused serious distortions inthe
intermodal mix of traffic leading to various adverse consequences. In order to reversethe
trend, it is necessary that the capacity of Indian Railways be augmented. Equally important is
the need to improve the quality of rail services through technological up grading and
modernization. In the recent past, Indian Railways took some steps to involvethe private
sector in the development of railway infrastructure and services. Two separate schemes were
initiated. These were own your own wagon scheme (OYWS) and build-own-lease-transfer
(BOLT).

2.ROADS

The road network in India, which is seemingly very large witha length of about 3 million
kilometres, cannot meet the accessibility and mobility requirements of acountry of India’size
and population. The road network suffers from serious deficiencies in a number of areas.The
road sector along with the rest of the transport sector has remainedunder funded over
successive plan periods in the past. In order to raiser sources and complete the projects at
afaster pace, the National Highway Act, 1956 was amended in 1995 to encourage private
Sector participation in the development, maintenance and operation of national highways.The
private sector can now invest in national highway projects, levy, collect and retain fees from
user charges and is also empowered to regulate traffic on such highways in line with the
provisions of the Motor Vehicle Act. A number of incentives are given to the private sector
for the development of road projects.

16
3.PORTS

Ports are the gateways for India’s international trade by sea andhandle about 90 per cent of
foreign trade. There are 11 major ports and 139 operable minor and intermediate portsa long
the long coastline of the country.The major ports of the country handled 281 milliontonne of
cargo in 2000-01. By the end of 2007 Indian ports are expected tohandle 415million tonnes
of cargo. This will require huge investments for the creation of additional facilities. There is
also urgent need for them odernization of existing ports to improve their operational
efficiency, which is quite low compared with major in the region.

Private sector participation in the development of ports in Indiais encouraged through two
models.Under the first model, the private sector can exclusively buildand operate the
Facility and after completion of the concession period transfersit to the concerned
portauthority.

The second model envisages the involvement of the private sector through jointventure
project.

4.AIRPORT

Air transport plays animportant role in India where the industrial and commercial centres

are located far apart and terrain and climatic conditions are quite different from one part of
the country to the other.

The full potential of the civil aviation sector in India, however, has yetto be realized.
Thismay necessitate an improvement in the quality ofservices, competitive pricing, better
airport infrastructure, etc.

In the past, steps were taken to improve the quality of air transport services. The emphasis
was on liberalization of the airtransport sector in order to encourage private sector
participation. Over the years, the Government has disengaged itself considerably from
commercial airline operations. Private sector participation in domesticair services has
beenaimed at bridging the resource gap in investments to meet the growing demand and
improve the managerial and operational efficiency of air services. The process of dis-
investment of public sector airlines namely, Air India and Indian Airlines, is under active
consideration. In order to make the major airports world class, a decision has been taken to

17
restructure the existing airports at Delhi, Mumbai, Chennai and Kolkata through long-
termleases. While the process of disinvestment of Indian Airlines and Air India has received
some set backs, progress with regard to private sector participation in the development of the
four metro politan airports at Delhi, Mumbai, Chennai and Kolkota has been sastisfactory.

3.3 Create are porton taxation India:

The tax structure in India is divided into direct and indirect taxes.The taxation system in India
is such that the taxes are levied by the Central Government and the State Governments. Some
minor taxes are also levied by the local authorities such as the Municipality and the Local
Governments.

Taxes in India are levied by the Central Government and the state governments. Some minor
taxes are also levied by the local authorities such as the Municipality.

The authority to levy a tax is derived from the Constitution of India which allocates the
power to levy various taxes between the Central and the State. An important restriction on
this power is Article 265 of the Constitution which states that "No tax shall be levied or
collected except by the authority of law". There fore, each tax levied or collected has to
bebacked by an accompanying law, passed either by the Parliament or the State Legislature.
None the less, tax evasion is a massive problem in India, ultimately catalyzing various
negative effects on the country. In 2018–19, the Direct tax collections reported by CBDT
were approximately INR11.17trillion.

Brief History of Income Tax in India: In India, this tax was introduced for the first time
in1860, by Sir James Wilson in order to meet the losses sustained by the Government on
account of the Military Mutiny of 1857 ............................. In consultation with the Ministry of
Law finally. The Income Tax Act,1961was passed.

Tax is a mandatory liability for every citizen of the country. There are two types of tax inindia
i.e. direct and indirect. Taxation in India is rooted from the period of Manu Smriti and Art has
astra. Present Indian tax system is based on this ancient tax system which was based on the
theory of maximum social welfare.

"It was only for the good of his subjects that he collected taxes from them, just as the Sun
draws moisture from the Earth to give it back at housand fold".

18
By Kalidas in Raghuvansh eulogizing KING DALIP. The origin of the word "Tax" is from
"Taxation" which means anestimate.

In India, the system of direct taxation as it is known today has been in force in one form or
another even from ancient times. Variety of tax measures are referred in both Manu
Smritiand Arthasastra. The wise sage advised that taxes should be related to the income and
expenditure of the subject. He, however, cautioned the king against excessive taxation; a
kings hould neither impose high rate of taxn or exempt all from tax.

According to Manu Smriti, the king should arrange the collection of taxes in such a manner
that the tax payer did not feel the pinch of paying taxes. He laid down that traders and
artisans should pay 1/5th of their profits in silver and gold, while the agriculturists were to
pay 1/6th, 1/8thand 1/10 the of their produce depending upon their circumstances.

3.4 Characteristics of Tax:

 The main characteristics of tax are:

 Tax is non-penal.
 It is not fine. It is imposed without any certain purpose.
 It is paid without any expectation of direct benefit.
 It is a most important fiscal mechanism of transferring private
property to stateproperty.
 It is compulsory payable by the persons. Peopleare bound to pay taxifit is imposed.
 It is as our ceofrevenue. It is the primes our ceofrevenue for the government.
 It is generally payable in money.
 It is enforced contribution: Its payment is not voluntary nature, and the imposition is
not dependent up on the will of the person taxed.
 It is generally pay able in cash: This means that payment by checks, promissory
notes, or ink in dis not accepted.
 It is proportionate in character: Payment of taxes should be base on the ability to pay
principle; the higher income of the tax payer the bigger amount of the tax paid.
 It is levied (to imposed; collect) on person or property: There are taxes that are
imposed or levied on acts, rights or privileges. Ex. Documentary tax.
 It is enforced contribution: Its payment is not voluntary nature, and the imposition is

19
 not dependent upon the will of the person taxed.
 It is generally payable in cash: This means that payment bychecks, promissory notes,
or in kind is not accepted.
 It is proportionate in character: Payment of taxes should be base on the ability to pay
principle; the higher income of the tax payer the bigger amount of the tax paid.
 It is levied (toimposed; collect) on person or property: There are taxes that are
imposed or levied on acts, rights or privileges. Ex Documentary tax.

 It is an enforced contribution for its imposition is in no way dependent upon the will
or assent of the person taxed. Consent is not an element. This is why some hold theextreme
view that taxation is robbery or theft because it is taking of property without oragainst the
will of the owner.

 It is generally payable in the form of money, although the law may provide
paymentin kind. For example, backpay certificates are an acceptable form of payment under
Sec. 2, R.A. No. 304, as amended. The reason why tax should generally be paid inmoney is
liquidity. The Government needs cash for its operation (to pay employees,etc.). Another
reason is valuation. Money has a value certain on its face; where as, real or personal property
still needs appraisal and its market value may fluctuate.

20
3.5 Principles of Taxation:

Although they need to be reinterpreted from time to time, these principles retainer markable
relevance. From the first can be derived some leading views about what is fair inthe
distribution of tax burdens among taxpayers. These are: the belief that taxes should bebased
on the individual’s ability to pay, known as the ability-to-pay principle, andthebenefit
principle, the idea that there should be some equivalence between what theindividual pays
and the benefits he subsequently receives from governmental activities. Thefourth of Smith’s
canons can be interpreted to underlie the emphasis many economistsplace on a tax system
that does not interfere with market decision making, as well as themore obviousneed
toavoidcomplexity andcorruption.

Distribution of tax burdens:

Various principles, political pressures, and goals can direct a government’s tax policy.
Whatfollows is a discussion of some of the leading principles that can shape decisions about
taxaEquity:

Equity:

Taxation involves compulsion. Therefore, it is important for the tax system to be fair. On
grounds of equity thas been suggested thatatax systems hould be based on a principle of
equal sacrifice or ability to pay. The latter is determined by (a) income or wealth and (b)
personal circumstances.

Richard Musgrave has argued that taxes are to be judged on two maincriteria: equity
(Isthetax fair?) and efficiency (Does the tax interfere unduly with the workings of the market
economy?) It comes to us a surprise that economists have been mostly concerned with the
latter, while publicdis cussions about tax proposals always focus on the former.

Vertical Equity:

The second concept of fair taxation follows logically from the first. If equals are to betreated
equally, it logically follows that un-equals should be treated unequally. This precept is know
nas vertical equity. This concept has been translated in to the ability to pay principle,
according to which those most abletopay should pay the maximum amount of taxes.
Broadly, the principle suggests that the fairest tax is one based on one’s financial ability to

21
Support governmental activities through tax payments. The ethical base of this principle rests
on the assumption that one rupee paid in taxes by arich person represents less sacrifice than
does the same rupee tax paid by a poor man andthat fairness demands equal sacrifice by both
rich and poor in support of government. Thus, a rich man must pay more money in taxes
than would a poor man for each to bear the same burdenin supporting services provided by
the government.

Horizontal equity:

The principle of horizontal equity assumes that persons in the same or similar positions (so
far as tax purposes are concerned) will be subject to the same tax liability. In practice this
equality principle is often disregarded, both intentionally and unintentionally. Intentional
violations are usually motivated more by politics than by sound economic policy (e.g., thetax
advantages granted to farmers, home owners, or members of the middle class ingeneral; the
exclusion of interest on government securities). Debate over tax reform has of tencentred on
whether deviations from “equal treat ment of equals” are justified.

The ability-to-pay principle:

The ability-to-pay principle requires that the total tax burden will be distributed among
individuals according to their capacity to bear it, taking into account all of the relevant
personal characteristics. The most suitable taxes from this standpoint are personal
levies(income, net worth, consumption, and inheritance taxes). Historically there was
common agreement that income is the best indicator of ability to pay. There have, however,
been important dissenters from this view, including the 17th-century English philosophers
John Locke and Thomas Hobbes and a number of present-day tax specialists. The early
dissenters believed that equity should be measured by what is spent (i.e., consumption) rather
than bywhat is earned (i.e., income); modern advocates of consumption-based taxation
emphasizethe neutrality of consumption-based taxes toward saving (income taxes
discriminate againstsaving), the simplicity of consumption-based taxes, and the superiority of
consumption as ameasure of an individual’s ability to pay over a lifetime. Some theorists
believe that wealthprovides a good measure of ability to pay because assets imply some
degree of satisfaction(power) and tax capacity, even if (as in the case of an art collection)
they generate notangible

22
Income:

Income is said to be a better measure of ability than wealth. But here also some
difficultiesare encountered. All work do not involve the same sacrifice. A man earning
Rs.500 throughtoil and trouble will not be a position to pay taxes as one earning the same
amount with out any effort (from paternal property)or gamblingor through chance(lottery).

One with the same level of income as another may have more dependents and more
liabilityand thus lower ability to pay. Moreover, the marginal utility of money differs from
man toman. It is higher to a man with lower income and vice versa. So, in the ultimate
analysis, income is not a good test of ability.

Expenditure:

According to Prof. N. Kaldor, expenditure is the best possible measure of ability. Head
vocated an expenditure tax which was tried in India for sometime but with drawn
subsequently. A poorman may spend more if he has more dependants and if he has to look
After his old parents, his expenditure may be higher than his colleague be longing to the
same in come bracket. But his expenditure does not reflect histrueabilitytopay.

Property:

Possession of wealth or property is a reflection of well- being, but to a limited degree.

Forexample, if two persons have the same amount of wealth, they are not equally well-off.
Onemayhavesomeproductivewealthlikeabuildingwhichyieldsasteadyincome.Anothermay
have unproductive wealth (i.e., jewellery). of the same value. Naturally, their ability to pay
taxes will differgreatly.

The benefit principle:

Under the benefit principle, taxes are seen as serving a function similar to that of prices
inprivate transactions; that is, they help determine what activities the government will under
take and who will pay for them. If this principle could be implemented, the allocationof
resources through the public sector would respond directly to consumer wishes.

Economic efficiency:

The requirement that a tax system be efficient arises from the nature of a market economy.

23
Although there are many examples to the contrary, economists generally believe that markets
do a fairly good job in making economic decisions about such choices as consumption,
production, and financing. Thus, they feel that tax policy should generally refrain from
interfering with the market’s allocation of economic resources. That is, taxation should entail
a minimum of interference with individual decisions. It should not discriminatein favour of,
or against, particular consumption expenditures, particular means of production, particular
forms of organization, or particular industries. This does not mean, ofcourse, that major
social and economic goals may not take precedence over theseconsiderations. It may be
desirable, for example, to impose taxes on pollution as a means ofprotectingtheenvironment.

Ease of administration and compliance:

In discussing the general principles of taxation, one must not lose sight of the fact that taxes
must be administered by an accountable authority. There are four general requirements for
the efficient administration of tax laws: clarity, stability (or continuity), cost-effectiveness,
and convenience. Administrative considerations are especially important in developing
countries, where illiteracy, lack of commercial markets, absence of books of account, and
inadequate administrativere sources may hinder both compliance and administration.
Under such circumstances the achievement of rough justice may be preferable to infeasible
fine- tuningin the name of equity.

Clarity:

Tax laws and regulations must be comprehensible to thet axpayer; they must beass impleas
possible (given other goals of tax policy) as well as unambiguous and certain—both to the
tax payer and to the tax administrator. While the principle of certainty is better adhered to

24
To day than in the time of Adam Smith, and arbitrary administration of taxes has been
reduced, every country has tax laws that are far from being generally understood by the
public. This not only results in a considerable amount of error but also undermines honesty
and respect for the law and tends to discriminate against the ignorant and the poor, who
cannot take advantage of the various legal tax-saving opportunities that are available to the
educated and the affluent. At times, attempts to achieve equity have created complexity,
defeatingre form purposes.

Stability:

Tax laws should be changed seldom, and, when changes are made, they should be carried out
in the context of a general and systematic tax reform, with adequate provisions for fair and
orderly transition. Frequent changes to tax laws can result in reduced compliance or
inbehaviour that attempts to compensate for probable future changes in the tax code—such as
stock piling liquor inadvance of an increased tariffonalcoholicb everages.

Cost-effectiveness:

The costs of assessing, collecting, and controlling taxes should be kept to the lowest
levelconsistent with other goals of taxation. This principle is of secondary importance
indeveloped countries, but not in developing countries and countries in transition
fromsocialism, where resources needed for compliance and administration are scarce.
Clearly, equity and economic rationality should not be sacrificed for the sake of cost
considerations.The costs to be minimized include not only government expenses but also
those of thetaxpayer and of private fiscal agents such as employers who collect taxes for the
government through the with holding procedure.

Convenience:

Payment of taxes should cause taxpayers as little inconvenience as possible, subject to

thelimitations of higher-ranking tax principles. Governments often allow the payment of
large tax liabilities in install ments and set generous time limits for completing returns.

25
Economic goals

The primary goal of a national tax system is to generate revenues to pay for the expenditures
of government at all levels. Because public expenditures tend to grow at leastas fast as the
national product, taxes, as the main vehicle of government finance, should produce revenues
that grow corres pondingly. Income, sales, and value-added taxesgenerally meet this
criterion; property taxes and taxes on nonessential articles of mass consumption such
astobacco products and alcoholic beverages do not. Inaddition to producing revenue, tax
policy may beused to prom ot eeconomicstability. Changes in taxliabilities not matched by
changes in expenditure scushioncyclical
fluctuations in prices, employment, and production. Built-in flexibility occurs because
liabilities for some taxes, most notably income taxes, respond strongly to changes
ineconomic conditions. A more-active approach calls for changes in the tax rates or other
provisions to increase the anticyclical effects of tax receipts.

Neutrality:

Prima facie, a tax system should be designed to be neutral, i.e., it should disturb the market
forces as littleas possible, unless there is a good reason to the contrary.
As a general rule, people do not like tax payment. In fact, every tax provides an incentive to
do something to avoid it. Since the government isunder compulsi on to collect taxes, it is not
possible to guarantee complete neutrality. The tax system must, therefore, seek to
achieveneutrality, by minimizing the disturbanceto the market that comes from taxation.

Non-neutrality:
Sometimes it becomes essential to maintain non-neutrality for meeting certain social
objectives. These objectives can be secured by providing tax incentives. This means that
insome cases, it may bedesirable to disturb the private market.

For example, the government may impose tax on polluting activities, so as to discourage firms
to pollute the environment. Likewise, a tax on cigarettes will serve a two-fold purpose: raising
revenue and discouraging consumption of this harmful item. In both the cases, the market is
disturbed but inadesi rableway.

26
Minimum costs of collections and compliance, consistent with effectiveen
for cement:

The ruler equires that taxesbe established in such am anner as to minim is ethe real costs of
collections, in terms of resources required as in terms of the direct inconvenience caused to
the tax payers. In fact, different writers have formulated the different theories, at different
times, relating to the equitable distribution of the burden of taxation among the people.

The principles of taxation, that is, the appropriate criteria to be employed in thedevelopment
and evaluation of the tax structure, have received attention from the days of Adam Smith.

3.6 Different types of Taxes Applicable in India:

Taxes are an essential part of any nation to promote its economic growth. The taxes that we
pay fill the coffers of the government, which are the nutilized byitto deliver various services
to the country’ spopulation. The government has beengiven the authority to collect taxes by
the Indian Constitution. All the taxes that we pay are backed by laws passed by either the
Parlia ment or the State Legis lature.
Now that we know what taxesare, let’slookat the type of taxes in India.

Different types of taxes:

India has two types of taxes, namely Direct Tax and Indirect Tax. The core difference
between both the taxes lies in their implementation. Apart from these types of taxation, there
are other taxes or cess levied by the governmentfor specific purposes, which are – Krishi
Kalyan Cess, Swachh Bharat Cess and Infrastructure CessTax.

DirectTax:
Direct Taxes comprise taxes that you pay directly to the government. These taxes are levied
directly on an individual and therefore can’t be transferred to another entity or person. The
Central Board of Direct Taxes (CBDT) under the Department of Revenue is responsible for
the governance of this tax.
There are various types of Direct Taxes, which include:

27
IncomeTax:
Income Tax came into force with the Income Tax Act of 1961. All the rules of income tax
areset by this act. This tax will apply to any income you generate for profits, owning a
property, salary, investments or business. Besides stipulating from where income tax is to be
collected, this act has provisions thatallow tax benefits for taxpayers through fixed deposits
and life insurance premiums. This act also determines your position on the income taxs lab.
GiftTax:
In 1958, the Gift Tax Act was originally introduced. According to the act, if you receive
presents of any kind, then you will have to pay a tax of 30%. This was later tweaked to
exclude gifts from family such as spouse, parents and blood relatives. If anyone else gives
agift whose value exceeds Rs.50000,then you will have to pay tax.
WealthTax:
Amongst the various types of taxes, Wealth Tax is applicable not only on an individual but
also on a Hindu Unified Family (HUF) and businesses. For example: If your net wealth is
more than Rs. 1 crore, then you have a surcharge of 12%. Companies whose turn over
exceeds10 crores will also have to pay wealth tax.
Capital GainsTax:
This is a type of Income Tax levied on the gains you make after the sale of an investment
orproperty. There are two types of Gains Tax – Long Term Capital Gains Tax and Short
Term Capital Gains Tax. The former is applied when the holding period of the investment
exceeds36 months. The latter is applicable if the duration of the investment is less than 36
months.
SecuritiesTransaction Tax:
Share trading on the stock market is subject to this tax. For every share purchase or sale,you
paytheSecuritiesTransactionTax.
CorporateTax:
Another type of Income Tax, the Corporate Tax is levied on the earning of businesses. An
Indian firm whose turn over is less than Rs. 1 crore is not subject to this tax. There is
acorporate tax slab according to which companies pay tax. Moreover, the tax structure for
inter national firms is different from domestic firms.

28
Indirect Taxes:
Unlike Direct Taxes, these taxes are not levied on individuals but on goods and services. This
tax is not levied on profit, income or the revenue of an individual or an entity. Also, this tax
can be transferred from one person to another. Here’salist of various types of Indirect Taxes:
Sales Tax:
Any product being sold is subject to Sales Tax. The product can be either produced
domestically or be imported. The government subjects the seller of the product to the sales
tax, who can then pass it on the buyer. Sales Tax is different for different states. Also, the
central government levies the sales tax. For some states, sales tax is one of their largest
revenue sources.
Service Tax:
Service Tax is applicable on services provided by companies. Unlike Sales Tax, it is not
charged on every sale. This tax is charged with on a monthly or quarterly basis. Service
providers pay this tax once their customers clear their bills.
Goods and ServiceTax:
The Goods and Services Tax was introduced in 2017. This tax is applied at the consumption
stage. GST is applied at every stage of the supply chain wherever consumption takes place.
Value Added Tax (VAT):
VAT is levied on products other than commodities such as food and essential drugs.This tax
is placed at stages in the supply chain where value is added. This tax comes under the
purview of the state government.

Customs Duty:
If you buy a product from a different country and import it to India, then you have pay tax on
it. This taxis called Customs Duty.

Toll Tax:
Toll Tax is levied either by the state or central governments on roads and bridges. The
purpose of the tax is to fundroad construction and maintenance activities.
Both Direct and Indirect Taxes are essential for the economic growth of the country.

29
3.7 Taxation on Private transport sector:
Road transport has traditionally been subject to a number of fuel andvehicle taxes, the
purposes being to collect revenue, cover in frastructure costs, or correct externalities
(environment and congestion). Yet, over the last few years, several factors have been under
mining the operation and effectiveness of such taxes: i) pervasive local pollution and
congestion problems that are only indirectly related to type of vehicle and fuel consumption,
ii) trend towards a more energy efficient fleet, reducing the revenue capabilities of the
system, and iii) increasing changes in mobility options (car sharing, etc.) Inthis chapter we
suggest a new approach to wards transport taxation that is based on both the characteristics
of the vehicle and its actual use (time andlocation). Taxing the real use of avehicle is now
technologically feasibleand can more effectively tackle the externalities associated with road
transport (including local pollution, climate mitigation andcongestion)while maintaining
revenue-raising capabilities and providing sizeable tax revenues to different levels of
government. Given the difficulties associated with animmediate transition to the new system,
the chapter also considers several alternatives formoving from the current tax situation.

Introduction:
Road transport is undergoing the biggest change since the beginning of the 20th century.Thes
cenari of or vehicle manufacturing and for vehicle use has been changed substantially by
amultitude of factors, including goals to reduce emissions and transition towards low-carbon
economies, the impacts of increasing urbanization in today’s societies, a new regulatory
attitude to wards mobility, technological progress in the sector and changes in the patterns of
acquisition, possession and use of private vehicles. And, behind these far-reaching
technological, social andregulatory changes, others are taking place, and will takeplace, in
every aspect relating to thesector, including fiscal aspects.Mobility has always beenof
interest for the tax system, mainly because the purchase, possessionand use of
vehiclesindicate ability to pay, because fuel consumption is inelastic and is on a hugescale,
andbecause tax revenue is high and stable. For decades, tax systems have used a triad
offiscalfigures (registration tax, recurring road tax and fuel taxes), which have worked
relativelywell. But the changes mentioned above are affecting them more and more, even
questioning the irexistence.

30
Currentsituation of transport taxation:
To date, the application of road transport taxes has largely been based on fiscal reasons
(Gagoet al., 2014). According to the latest data available on these taxes, they brought inabout
5% oftax revenue in both the European Union (EC, 2018) and the USA (USDT,
2017;OECD,2018) (1.8% and 1.3% of GDP, respectively).The low priceelasticity of the main
source of revenue, auto mobile fuels (see Brons, 2008; Labandeira et al, 2017), means that
taxes on them have limited effects on consumption and, therefore, on the volume and stability
of revenue. In fact,these figures exemplify the so-called optimal taxation on goods and
services because, by producing only slight alterations in consumer behavior, they generate
public revenue at lowefficiency costs (Ramsey,1927).The revenuefrom these taxes has
generally been used without any specific assignment, althoughin some countries ithas been
used (partially or totally) for funding transport infrastructure. In the USA, the fede raltax on
fuels finances approximately90% of the Highway Trust Fund, which mainly goes to the
construction of high ways and other transport projects (Lowry, 2015), 1while taxes on fuels
are also the main source of revenue for states for funding their road networks and other
transport in frastructure (Brouweretal.,2016)

Problems and challenges faced by transport taxation:

As stated above, we are facing a process of important changes and friction in road transport.
The tax implications are obvious. There are doubts about the continued revenue-raising
capacity ofthe existing taxes (without many alternatives for replacing them with in existing
tax systems), andabout their capacity for meeting current and future corrective challenges
(without many efficient regulatory alternatives outside this area). We analyze below these
challenges and their impact on transport taxation and also give abrief description of some
pioneering experiences that might throw some light on options for the future.
Technology, behavior and revenue loss:
The revenue-raising capacity of fuel taxes, which is crucial for many tax systems and for
maintaining road infrastructure in places such as the USA, is decreasing because of the
increasing energy efficiency of vehicles and the gradual introduction of hybrid and electric
vehicles (McMullen et al., 2010). In the European Union, the energy efficiency of transport
increased by 1.2% per year during the period 2000-2013 (Faberi et al., 2015), while fuel
consumption of new vehicles fell annually by 3.4% between 2007 and 2015 (ODYSSEE-
MURE, 2018) and the use of alternative fuels rose to 7.5% of total energy consumption

31
forroad transportin 2014 (Bertoldi et al., 2016). As an illustration, transport taxes have
beenloosing relevance inboth total revenue raised and percentage of GDP (about 17%
reduction between 2016 and 2002) in the EU (EC,2018).
Externalities and taxation in the transport sector:
Road transport is responsible for many of the external costs caused by the sector (van
Essen,2011), including both global and local pollution, congestion, accidents and noise.
However, the cost of these externalities is not reflected in the market prices of vehicles or
fuels and gives rise toinefficient results in the absence of public intervention (Santos et
al.,2010). The following are themain externalities associated with road transport. Existing
corrective policies are discussed and some guidelines are given for future developments.
Novelties in transport taxation:
The problems and challenges mentioned so far have led to a certain innovation in transport
taxation over recent decades. The inclusion of new goals (environmental protection, control
of mobility, funding of infrastructure, etc.) has demanded changes in the definition and
structure ofnew taxes. Technical advances in geolocation systems and remote vehicle
identification are leading research towards the design of more precise and streamlined
fiscalinstruments to deal with the problems of congestion and access to urban areas. In this
section, we aim to contextualize and summarize the main applications in this area. The
regulatory context in which these new figures are being introduced is fairly biased to wards
conventional regulatory approaches (command and control). Over recent years, A
increasingrole is being played by vehicle technology standards, in the form of increasing
limits on GH Gemissions per distance traveled, but obviously there are many difficulties for
dealing withmany of the above-mentioned problems. It is therefore not unusual to find
prohibitions on access to certainareas, mostly urban areas, for vehicles that do not comply
with minimum emission levels (CleanAir,2015b). A more flexible regulatory alternativeis to
limit access to such areas by registrationplate, some times using more sophisticated solutions
that also take in to account the characteristics of the vehicles entering (Barahona et al., 2018).
The fiscal charges for access tocertain areas (see section 3.2.1) listed below can be
interpreted as an even more so phisticated and flexible approach to limiting access to certain
areas and to reducing the heavy external costs (CleanAir,2015a).

32
Road usetax:
In 2001, faced with a drop in fuel tax revenue (the main source of infrastructure funding), the
government of the state of Oregon started to search for new tax alternatives. Of the various
options considered, they decided that a payment ‘per mile’ would be the fairestalternative to
fueltax, so they adopted two pilot programs to test for its applicability (Munnich et al., 2011).
In 2015 they adopted OReGO, a voluntary program limited initially tojust 5,000 vehicles, in
which participants have to fit a device in the vehicle to record the distances traveled. They
can choose from various options11, and the tax applied is 1.7 centsper mile. Fuel taxes,
which drivers pay at gas stations, are considered pre-payment and are discounted in
settlements of the new tax.

Reforming taxationon transport:

Incremental changes in the current system
An initial option for facing the crisis in transport taxation would be to simply avoid its use an
dincrease other taxes to replace the revenue they bring in, using planning or conventional
regulations to deal with the externalities associated with transport. In fact, most of them
easures being proposed today by cities and governments to deal with transport externalities
are regulations or prohibitions of different types. However, although such measures might
seem more effective or fairer than pricing instruments, in practice they are substantially less
efficient formitigating transport externalities (Kleit, 2004; Austin andDinan, 2005; Anderson
et al., 2011;Jacobsen, 2013; Anderson and Sallee, 2016; Levinston,2018)andmay also be
more regressive (Levinson,2018).

A Comprehensive Auto mated Tax on Vehicles (CATV):

The above problems suggest that a far-reaching, thorough reform on transport taxation
isneeded. One initiative with great potential is taxation on vehicle use (McLure, 2009).
Suchfigurescan tackle many of the problems associated with today’s transport taxation, such
asthegeneration of public revenue, congestion, emissions or infrastructure deterioration
Lindsey,2010). On the one hand, this alternative has potential for generating more
stablerevenue thanfuel taxes, because drivers cannot reduce their tax burden by driving
moreefficient vehicles (Langer et al., 2017). On the other, by using tax rates that vary by
locationand time, the problemsof congestion and local contamination could be tackled
moreeffectively, and a tax on the realdistance traveled could deal with the other externalities.

33
Transition to the CATV:
As explained in the previous section, the CATV would deal better with the
externalitiesassociatedwith road transport and would also have a high potential for bringing
in revenue,which would beeasily divided among the different administrations depending on
the type of externalities corrected (congestion and local pollution for municipal districts,
infrastructure for regional and central administrations, etc.). However, there are also
problems and difficulties thathaveto be considered to guarantee the feasibility of the tax.

3.8 Create a repor ton GST and its implemention:

The year 2017 will forever be etched in Indian history as the year that saw theimplementation
of the biggest and most important economic reform since Independence -the Goods and
Services Tax (GST). The reform that took more than a decade of intense debate was finally
implemented with effect from 1 July 2017, subsuming almost all indirect taxes at the Central
and State levels.

GST, which was publicised as ‘one nation, one tax’ by the government, aims to provide
asimplified, single tax regime in line with the tax framework applicable in several
majoreconomies across the Globe. This single tax has helped streamline various indirect
taxes andbrought in more efficiencies in business. GST law in India is a comprehensive,
multi-stage, destination-basedtaxthatislevied onevery value addition.

The implementation of the GST got overwhelming support from the industry. The
industrytook this as an opportunity to redefine supply-chain model, customise IT processes,
andevaluate internal and external arrangements to safeguard interest and minimise their
taxcosts.
As the GST journey progressed, there was a growing realisation of its far-reaching
impact.Industry faced various challenges, ranging from new and unique concepts,
complexdocumentation,high taxratesofcertaingoodsandservices tocomplexoruncleartreatment
of several common transactions. The matching concept for claiming credits,adverse and
contrary advance rulings, ambiguity on aspects relating to Anti-Profiteering,GSTrefunds etc.
are some of the emerging challenges that the businesses should be mindful of.However, it
should also be appreciated that the authorities have been quick to addresspublic concerns by
issuing a series of notifications, clarifications, press releases and FAQs, toresolve
awiderangeofissues.

34
There is hope that GST 2.0, which is at the works currently, will be a much improved
versioncomparedtothefirstone.Thegovernmenthascome outwithnew returnfilingprocess.
There have been multiple reduction in tax rate for various goods. With the objective to
curbtax evasion, the government has also introduced the e-way bill satatment across India,
totrackmovementofgoods.
Levy of GST:
 Itisaduallevywith State/UnionterritoryGSTand Central GST.
 Intra-statesuppliesattractCGST+SGST/ UTGST.
 Inter-statesuppliesIGSTwhichisthesumtotalofCGSTandSGST/UTGST.

Exclusions under GST:

 Basic Customs duty on import of goods intoIndia.
 Petroleum products (petrol, diesel, ATF, natural gas and crudeoil).
 Alcohol for human consumption

GST rate classification:

 0% - Essential food and medicines, newspaper, education
services, residentialaccommodation.
 0.25%-Diamonds,other preciousstones.
 3%-Gold, silver, platinum, articlesofjewellery.
 5%-Commonuseitems,sweets ,restaurant services, tour operator services.
 12%-Frozen meat,butter and cheese, Namkeens, Milk beverages.
 18%- Standard rate for goods and services.
 28% - Luxury and sin goods such as motor vehicles (additional
cess imposed oncertainluxury goods).

Benefits of GST:
 Widertaxbase.
 Eliminationofcascadingeffectofmultipleindirecttaxes.
 Rationalisationoftaxstructure.
 HarmonisationofCentreandStateadministrations.

35
Why was GST introdunced in India?
GST, which was publicised as 'one nation, one tax' by the government, aims to provide
asimplified, single tax regime in line with the tax framework applicable in several
majoreconomies across the Globe. This single tax has helped streamline various indirect
taxes and brought in more efficiency in business.

One of the main reasons for GST being introduced in India is the tax burden that falls both on
companies and consumers. With the current tax system, there are multiple taxes addedat each
stage of the supply chain, without taking credit for taxes paid at previous stages. Asa result,
the end cost of the product does not clearly show the actual cost of the product and how
much tax was applied.This cascading structure is too complex and inefficient.

GST willintegrate most taxes intoa single one, that will be applied to the sale and purchase of
goods and services, with deductions for taxes paid at previous supply chain stages. This
structure is predicted to be easier to track both for the government and business owners.

In 2003, the Central Government formed a taskforce on Fiscal Responsibility and Budget
Management, which in 2004 recommended GST to replace the existing tax regime
byintroducing a comprehensive tax on all goods and services replacing Central level VAT
and State level VATs.

Dasgupta admitted in an interview that 80% of the plan had been formulated under his tenure
in the GST Council. He resigned from the chairmanship in 2011. GST was finally
implemented on 1 July 2017. He is referred to as the architect of India's GST.

3.9 History of GST (Detailed):

The idea of a Goods and Services Tax (GST) for India was first mooted sixteen years back,
during the Prime Ministership of Shri Atal Bihari Vajpayee. Thereafter, on 28th
February,2006, the then Union Finance Minister in his Budget for 2006-07 proposed that
GST wouldbe introduced from 1st April, 2010. The Empowered Committee of State Finance
Ministers (EC), which had formulated the design of State VAT was requested to come up
with aroadmap and structure for the GST. Joint Working Groups of officials having
representatives of the States as well as the Centre were set up to examine various aspects of
the GST and draw up reports specifically on exemptions and thresholds, taxation of services

36
and taxation of inter-State supplies. Based on discussions within and between it and the
Central Government, the ECreleased its First Discussion Paper (FDP) on GST in
November,2009.
The FDP spelled out the features of the proposed GST and has formed the basis for the
present GST laws and rules.

In March 2011, Constitution (115th Amendment) Bill, 2011 was introduced in the Lok
Sabhato enable levy of GST. However, due to lack of political consensus, the Bill lapsed
after the dissolution of 15th Lok Sabha in August 2013.

On 19th December, 2014, The Constitution (122nd Amendment) Bill 2014 was introduced
inthe Lok Sabha and was passed by Lok Sabha in May 2015. The Bill was taken up in
RajyaSabha and was referred to the Joint Committee of the Rajya Sabha and the Lok Sabha
on14th May, 2015. The Select Committee submitted its report on 22nd July, 2015.
Thereafter, the Constitutional Amendment Bill was moved on 1st August 2016 based on
political consensus. The Bill was passed by the Rajya Sabha on 3rd August 2016 and by the
Lok Sabhaon 8th August 2016. After ratification by required number of State legislatures and
assent ofthe President, the Constitutional amendment was notified as Constitution
(101stAmendment) Act 2016 on 8th September, 2016. The Constitutional amendment paved
way for introduction of Goods and Services Tax in India.

After GST Council approved the Central Goods and Services Tax Bill 2017 (The CGST
Bill), theIntegrated Goods and Services Tax Bill 2017 (The IGST Bill), the Union Territory
Goods andServices Tax Bill 2017 (The UTGST Bill), the Goods and Services Tax
(Compensation to theStates) Bill 2017 (The Compensation Bill), these Bills were passed by
the Lok Sabha on 29thMarch, 2017. The Rajya Sabha passed these Bills on 6th April, 2017
and were then enactedasActs on12th April,2017.T2015. 6 on 08.09.2016

Thereafter, State Legislatures of different States have passed respective State Goods
andServices Tax Bills. After the enactment of various GST laws, GST was launched with
effectfrom 1st July 2017 by Sh.Narendra Modi, Hon'ble Prime Minister of India in the
presence of Sh.Pranab Mukherjee, the then President of India in a mid-night function at the
Central Hall of Parliament of India.

37
In the Indian System, first time discussion on GST has been started in 2000. In 2000,
TheVajpayee Govt. started discussion on GST by setting up an empowered committee. The
committee was headed by AsimDasgupta (FM ofWestBengal).

3.10 Keys features of GST:

Key Features of GST and Benefits of GST, Salient Features of GST, features of gst in
india.Goods and Service Taxis also known as GST in a Canadian value added tax on most
goods and services sold for domestic consumption. Here we are Providing Features of Goods
and Service Tax (GST) and also provide benefits of Goods and Service Tax (GST). Check
out keyf eatures of the proposed GST model and Benefits to Traders and Government. Now
you can scroll down below check more details regarding “Key Features of GST and Benefits
of GST”.
(i) GST would be applicable on “supply”of goods or services as against the present
concept of tax on the manufacture of goods or on sale of goods or on provision of services.
(ii) GST would be based on the principle of destination based consumption taxation as
against the present principle of origin-based taxation.
(iii) It would be a dual GST with the Centre and the States simultaneously levying it on
acommon base. The GST to be levied by the Centre would be called Central GST (central
tax-CGST) and that to be levied by the States [including Union territories with legislature]
wouldbe called State GST (state tax- SGST). Union territories without legislature would levy
Union territory GST (union territorytax-UTGST).
(iv) An Integrated GST (integrated tax- IGST) would be levied on inter-State supply
(includingstock transfers) of goods or services. This would be collected by the Centre so that
the credit chain is not disrupted.
(v) Import of goods would be treated as inter-State supplies and would be subject to
IGST in addition to the applicable customs duties.
(vi) Import of services would be treated as inter-State supplies and would be subject to
IGST.
(vii) CGST, SGST /UTGST& IGST would be levied at rates to be mutually agreed upon
by the Centre and the States under the aegis of the GSTC.
(viii) GST would replace the following taxes currently evied and collected by the Centre:
Pag
a) Central Excise Duty;
b) Duties of Excise (Medicinal and Toilet Preparations);

38
c) Additional Duties of Excise (Goods of Special Importance);
d) Additional Duties of Excise (Textiles and Textile Products);
e) Additional Duties of Customs (commonly known as CVD);
f) Special Additional Duty of Customs (SAD);
g) ServiceTax;
h) Cesses and surcharges in so far as they relate to supply of goods or services.
(ix) State taxes that would be subsumed with in the GST are:
a) State VAT;
b) Central Sales Tax;
c) Purchase Tax;
d) Luxury Tax;
e) Entry Tax (Allforms);
f) Entertainment Tax (except those levied by the local bodies);
g) Taxes on advertisements;
h) Taxes on lotteries, betting and gambling;
i) State cesses and surcharges in so far as they relate to supply of goods or services.
(x) GST would apply to all goods and services except Alcohol for human consumption.
(xi) GST on five specified petroleum products (Crude, Petrol, Diesel, ATF& Natural gas)
would be applicable from a date to be recommended bythe GSTC.
(xii) Tobacco and tobacco products would be subject to GST. In addition, the Centre
would continue to levy Central Excise duty.
(xiii) A common threshold exemption would apply to both CGST and SGST. Taxpayers
with an annual turnover of Rs. 20 lakh (Rs. 10 lakh for special category States (except J&K)
asspecified in article 279A of the Constitution) would be exempt from GST. A compounding
option (i.e. to pay tax at a flat rate without credits) would be available to small tax payers
(including to manufacturers other than specified category of manufacturers and service
providers) having an annual turnover of up to Rs. 75 lakh (Rs. 50 lakh for special category
States (except J&K and Uttarakhand) enumerated in article 279A of the Constitution). The
threshold exemption and compounding scheme would be optional.Page6 of11
(xiv) The list of exempted goods and services would be kept to a minimum and it would be
harmonized for the Centre and the States as well as across States as far as possible.
(xv) AllExportsandsupplies toSEZsandSEZunitswouldbezero-rated.
(xvi) Credit of CGST paid on inputs may be used only for paying CGST on the output and

39
thecredit of SGST/UTGST paid on inputs may be used only for paying SGST/UTGST. In
otherwords, the two streams of input tax credit (ITC) cannot be cross utilized, except in
specifiedcircumstances of inter-State supplies for payment of IGST. The credit would be
permitted tobeutilized inthefollowing manner:
a) ITCof CGSTallowedforpaymentofCGST&IGST inthatorder;
b) ITCofSGSTallowedforpaymentofSGST&IGSTinthatorder;
c) ITCofUTGSTallowedfor paymentof UTGST&IGST inthatorder;
d) ITC of IGST allowed for payment of IGST, CGST & SGST/UTGST in that order.
ITC of CGSTcannotbe used forpaymentofSGST/UTGST andviceversa.
(xvii) Accounts would be settled periodically between the Centre and the State to ensure
that the credit of SGST used for payment of IGST is transferred by the originating State to
the Centre. Similarly the IGST used for payment of SGST would be transferred by Centre to
the destination State. Further the SGST portion of IGST collected on B2C supplies would
also be transferred by Centre to the destination State. The transfer of funds would be carried
out on the basis of information contained inthe returns filed by the tax payers.
(xviii) Input Tax Credit (ITC) to be broad based by making it available in respect of taxes
paidon any supply of goods or services or both used or intended to be used in the course
orfurtheranceof business.
(xxiv) System of self-assessment of the taxes payable by the rgistered person.
(xxv) Audit of registered persons to be conducted in order to verify compliance with the
provisions of Act.
(xxvi) Limitation period for raising demand is three (3) years from the due date of filing of
annual return or from the date of erroneous refund for raising demand for short-paymentor
non-payment of tax or erroneous refund and its adjudication in normal cases.
(xxvii) Limitation period for raising demand is five (5) years from the due date of filing of
annual return or from the date of erroneous refund for raising demand for short-paymentor
non-payment of tax or erroneous refund and its adjudication in case of fraud,suppressionor
willful mis-statement.
(xxviii) Arrears of tax to be recovered using various modes including detaining and sale
ofgoods, movable and immovable property of defaulting taxable person.
(xxix) Goods and Services Tax Appellate Tribunal would be constituted by the Central
Government for hearing appeals against the orders passed by the Appellate Authority or the
Revisional Authority. States would adopt the provisions relating toTribunal in respective
SGST Act.

40
4 Important key features of GST that you should know about:
 4 Key Features of GST(Goods and ServiceTax) Posted on 08 February 2020.
 Single IndirectTax. GST has been introduced as a single,unified tax reform.
 Input Tax Credit System. One of the most prominent GST features in India is the input
tax credit.
 GST Composition Scheme.
 Four-Tier Tax Structure.

1. SINGLEINDIRECTTAX:
GST has been introduced as a single, unified tax reform. It has eliminated many
existingindirect centre and state taxes like Central Value Added Tax, Special Additional Duty
ofCustoms, Service Tax, and VAT and converted them into a single tax. The elimination
ofthese indirect taxes has not only made tax compliance easier for businesses but has
alsohelpedinmakingmanyofthegoodsandservicesmoreaffordablefortheconsumers.

2. INPUT TAX CREDIT SYSTEM:

One of the most prominent GST features in India is the input tax credit. If a manufacturer
orservice provider has already paid input tax on a purchase, the same can be deducted
fromtheir total output tax liability. The input and output invoices need to match to take
advantage of the tax credit.This helps in removing the cascading tax effect or the traditional
‘tax-on-tax’ regime. Moreover, it also helps in reducing taxevasion.

3. GSTCOMPOSITIONSCHEME:
SMEs with an annual turnover of up to Rs. 1 crore or Rs. 75 lakhs in specified states can
alsovoluntarily opt for the composition scheme. With this scheme, the businesses can pay
afixed GST rate of 1% on their turnover. However, such businesses can then not use the
inputtax credit benefit. A business needs to select between whether they want to use the
composition scheme or the input tax credit feature.

4. FOUR-TIERTAXSTRUCTURE:
GST has a 4-tier tax structure of 5%, 12%, 18%, and 28%. All the goods and services can
only be taxed as per this tax structure. Many of the essential commodities such as food items

41
donot have any GST. Improved transparency and cheaper goods and services are two of the
biggest advantages of this 4-tierstructure.
There are several GST features, and they are already working as a game-changer for theIndian
economy. While it still has a long way to go, industries, consumers, and the government has
already started experiencing the benefits which are expected to extend further in the future.

3.11 The GST Mode limplemented inIndia:

India adopted a dual GST model, meaning that taxation is administered by both the Unionand
state governments. Transactions made within a single state are levied with Central GST
Models ofGST:There are three prime model sof GST: (CGST) by the Central

Fig:-3.1
Expected model ofGSTinIndia:

In India, the GST model will be “dual GST” having both Centraland State GST components
Levied on the same base.

Forexample,if a product have levy at a base product of Rs.1000 and the rate of CGST and
SGST are 10% then in such case both CGST and SGST will be charged on Rs. 1000 i.e.
CGST will be Rs.100 and SGST will be Rs.100.

The significant features of Dual GST areas under:

There will be Central GST to be administered by the Central Government and there will
beStateGSTadministered bytheStateGovernments.
Central GST will replace existing CENVAT and Service tax and the State GST will replace
StateVAT.
The proposed GST will have two components – Central GST and State GST – the rates of

42
which will be prescribed separately keeping in view there venue considerations, total tax
burden and the acceptability of the tax.
Certain components of petroleum, liquor and tobacco are likely to be outside GST
structure.further,State Excise on liquor may also be kept outside the GST.
As per the proposed GST regime, the input of Central GST can be utilized only for the
payment of CGST and the input of State GST can be utilized only for payment of SGST.

What will be out of GST?

 Levies on petroleum products;
 Levies on alcoholic products;

 Taxes on lottery and betting;

 Basic customs duty and safe guard duties on import of goods into India;
 Entry taxes levied by municipalities or panchayats;
 Entertainment and Luxury taxes;
 Electricity duties / taxes;
 Stampduties on immovable properties;
 Taxes on vehicles.
Benefits of GST implementation:
 The tax structure will be made lean and simple.In the long run, the lower tax burden
could translate into lower prices on goods for consumers.
 The Suppliers, manufacturers, wholesalers and retailers are able to recover
GSTincurred on input costs as tax credits. This reduces the cost of doing business, thus
enabling fairer prices for consumers.
 It can bring more transparency and better compliance.Number of departments
(taxdepartments) will reduce whichinturn may leadto lesscorruption.
 Companieswhich are under unorganized sector will come under tax regime.

43
GSTrateWorldwide:
GST rates of some countries are given below.
country RateofGST
Australia 10%
France 19.6%
Canada 5%
Germany 19%
Japan 5%
Singapore 7%
Sweden 25%
India 27%
NewZealand 15%
Pakistan 18%
Malaysia 6%
Denmark 25%
TABLE 3.1
SubsumingofExistingTaxes
SL.no SubsumedunderCGST SubsumedunderSGST

1. CentralExciseDuty VAT/Salestax

2. AdditionalExciseDuties Entertainmenttax(unlessitisleviedbylocal
bodies).
3. Excise Duty-Medicinal and Luxurytax
ToiletriesPreparation Act.
4. ServiceTax Taxeson lottery,bettingandgambling
5. AdditionalCVD StateCessesandSurcharges(Supplyofgoods
andservices)
6. SpecialAdditonalDutyofCustoms.. EntrytaxnotinlieuofOctroi
4%(SAD)
7. Surcharges
8. ceses

TABLE:-3.2

44
The taxation of goods and services in India has, hitherto, been characterized as a cascadingand
distortionary tax on production resulting in mis-allocation of resources and
lowerproductivityandeconomic growth.

Under the new structure, all different stages of production and distribution can beinterpreted
as a mere tax pass-through, and the tax essentially ‘sticks’ on final consumption within the
taxing jurisdiction.

FEATURESOFANIDEAL GST:
Themainfeatures ofGST areasunder:-
(a) GST is based on the principle of value added tax and either “input tax method”
or“subtraction”method,with emphasis on voluntary compliance and accounts baseds ystem.
(b) It is a comprehensive levy and collection on both goods and services at the same rate
with benefit of input tax credit or subtraction of value of penultimate transaction value.

(c) Minimum number of floor rates of tax, generally, not exceeding two rates.
(d) No scope for levy of cess, re-sale tax, additional tax, special tax, turnover tax etc.
(e) No scope for multiple levy of tax on goods and services, such as, sales tax, entry tax,
octroi , entertainment tax, luxury tax,etc.
(f) Zero rating of exports and inter State sales of goods and supply of services.
(g) Taxing of capital goods and inputs whether goods or services relatable to manufacture
at lower rate, so as to reduce inventory carrying cost and cost of production.

3.12 SWOT ANALYSIS OF GST ACT IN INDIA:

The SWOT Analysis framework is a very important and useful tool to use in marketing
management and other business applications.As a basic tool its mastery is a fundamental
requirement for the marketer, entrepreneur or business persons.
WHAT IS A SWOT ANALYSIS?
As per Wikipedia SWOT analysis (alternatively SWOT matrix) is an acronym for strengths,
weaknesses, opportunities, and threats and is a structured planning method that
evaluatesthose four elements of an organization, project or business venture. A SWOT
analysis can becarried outfor acompany, product, place, industry, or person.

45
It involves scaning of the internal and external environment is an important part of
thestrategic planning process.Environmental factors internal to the firm or Country usually
canbe classified as strengths (S) or weaknesses (W), and those external to the fir m or
Countrycan be classified as opportunities (O) or threats (T).Such an analysis of the
strategicenvironment isreferredtoasa SWOTanalysis.
WHY IS SWOT ANALYSIS DONE?
The SWOT analysis provides information that is helpful in matching theresources and
capabilities to the competitive environment in which it operates. It helps in analyzing your
organization’s strengths and weaknesses, and the opportunities and threats that you face. It
helps you focus on your strengths, minimize threats, and take the greatest possibleadvantage
of opportunities available to you.
Through this article I am trying to make a SWOT analysis of the introduction of GST Act
inIndia by the Modi Government. TheGoods and Service Tax Bill or GST Bill was
introduced tobring reform in the indirect tax regime within India. Withthe implementation of
GST inIndia, the government is hoping to create a common Indian market and thereby to
reduce the cascading effect of tax on the cost of goods andservices.
STRENGTHS OF GOODS AND SERVICE TAX IN INDIA:
The strength in the SWOT analysis are its resources and capabilities that can be used for
developing a competitive advantage over others. Some of the Strength of GST Act are.
 The GST Tax is applicable on all goods and services except some exempted products
mentioned in the exemption list of the Act.
 GST will subsume taxes like Central Excise Duty (1944), Central Sales Tax (1956)
Service Tax (1994) and a host of state levied taxes including Value Added Tax (VAT).
 It will drop out the cascading effects of tax on production and distribution of
goodsand services.
 Better Compliance and online submission of details would result in less paper work.
 This would eventually lead to more tax revenue.
 GST would be dual taxation system. It would be charged intra-State by Central
andState governments. It would be called CGST (Central Goods and Service Tax) andSGST
(State Goods and Service Tax) thereby eliminating loss of revenue of states
andCentralGovernment.

46
WEAKNESSES OF GOODS AND SERVICE TAX IN INDIA:
The absence of certain strengths are a weakness as per SWOT Analysis.

 The duel model of GST results in complicated billing and reconciliation.

 The system is fully technology driven, but India is a developing country where
peopleare not habitual oftechnology.
 GST is a subsume of various States and Central taxes but many more are left at the
discretion of State Government.

OPPORTUNITIES OF GOODS AND SERVICE TAX IN INDIA:

The external environmental analysis may reveal certain new opportunities for profit
andgrowth.Someopportunitiesinclude:

 The rates of tax are set at ground level which will help States and Unions to
collectmore revenue. This will result in Growth of Revenue for State and CentralGovernment
 GST will reduce average tax burden of consumers. They will be certain about
theirtaxeswhichwillreduceevasionoftaxes.
 GST can provide the opportunity of Corruption Free Indian Revenue Services. This
may help in uprooting the Black money economy and bringing all under traders andService
providers under the Tax regime.
 Lowpricesofmanufacturedproducts
 Increase in GDP
 Increase in export due to price competitiveness.

THREATSOF GOODSAND SERVICETAXININDIA:

Changes in the external environmental also may present threats to the system. Some ofsuch
threats include:
 The mechanism in GST is still complicated, it cannot completely eliminate
blackmoneyandtaxevasion
 Initial Burden on Consumers due to a temporary increase of cost of goods
andservices.
 GSTC (Goods and Service Tax Council) will set the benchmark for resolving the
dispute on recommendations of GSTC. It means GSTC will lay down the criteria for GSTC it
47
self. It is against the principle of natural justice.
 GST is not a guarantee in itself that it would not be influenced by political parties
andpoliticianswill notuseitas awin-loss game.
 Changes in the external environmental also may present threats to the system. Some of
such threats include:
 The mechanism in GST is still complicated, it cannot completely eliminate black
money and tax evasion
 Initial Burden on Consumers due to a temporary increase of cost of goods andservices.

 GSTC (Goods and Service Tax Council) will set the benchmark for resolving the
dispute on recommendations of GSTC. It means GSTC will lay down the criteria for GSTC
itself. It is against the principle of natural justice.
 GST is not a guarantee in itself that it would not be influenced by political parties and
politicians will not use it as awin-loss game.

3.13 GSTIN:
What is GSTIN?
GSTIN is GST identification number or GST number. A GSTIN is a 15-digit PAN-based
unique identification number allotted to every registered person under GST. As a GST -
registered dealer, you might want to do a GST Number (GSTIN) verification before entering
it in your GST Returns.

There can be multiple GSTIN for a single person, being an assessee under the Income TaxAct
for every State or Union Territory in which such person operates from. It becomes
compulsory to obtain GSTIN when the person crosses the threshold limit for
GSTregistrationby registering himselfunderGST.

Unlike the previous indirect tax regime, where multiple registration numbers were presentfor
different laws like Excise, Service Tax and VAT, it is a single registration number under
GST-GSTIN.

1. Importance of GSTIN:
GSTIN or GST number is public information. GST number search by name is an important
task that every business dealing with GST registered taxpayers must carry out to ensure the

48
authenticity of the vendor and the GSTIN or GST number being used in the invoice.
Technology has enabled you to verify GSTIN by a click of a button from anywhere
andanytime. Search GST number before you proceed with a deal. You can partly verify
GSTIN orGST number on the first look of it by checking if the vendor’s PAN number
matches with thedigits between 3 and 10 in the GSTIN. Use the ClearTax GSTIN
verification tool and GSTIN Validator to verify GSTINor verify GST number in jippy!
Know more about GST, Goods and Services Tax Laws.

2. GST Identification Number Format:

GSTIN structure comprises
 First2numbers→State code of the registered person
 Next10characters→PAN of the registered person
 Nextnumber→Entity number of the same PAN
 Nextcharacter→Alphabet Z by default
 Lastnumber→Check code which may be alpha or digit, used for detection of errors

Fig.3.1`

3. What is the Clear Tax GST Number Search Tool?

The ClearTax GST Number Search Tool and GSTIN Validator enables businesses to verify
any GSTIN with a single-click GSTIN search. This feature can be used by anyone free of

49
cost,provided they have there quisite GSTIN on hand.

4. How to use the ClearTax GST Number Search Tool and GSTIN
Validator? All you have to do is-
1. Enter a valid GSTIN number in the search box below
2. Click on “Search” button
If the GSTIN iscorrect,the details that can be verified here are-
 The legal name of the business
 State
 Dateofregistration
 Constitutionofbusiness–company,sole-proprietororpartnership
 Tax payer type– regular tax payer or composition dealer
 GSTINstatus/ UINstatus
GST Return Filing & Billing simplified with Clear Tax GST Software

Fig 3.3

5. Advantages of online GSTIN search & verification tool

or GSTINValidator:
 The benefits of verification of a GSTIN using GSTIN Validator are:
 To check the authenticity of any GSTIN
 A GSTIN on a hand-written invoice can be verified easily, Ifunclear
50
 You can prevent your self from associating with vendor susing fake GSTINs
 Avoid a GSTIN fraud
 H6. Frequently Asked Questions
 When will a GSTIN be allocated?
 Once the GST registration application is processed successfully, the GST portal
willallocate15digitsGSTINtotheapplicant.
 Isitmandatorytomention GSTINontheinvoices?
 Yes, it is mandatory to mention GSTIN on all the invoices raised by a taxpayer.
Also,the GST registered person should display the GST registration certificate at all
placeofbusinesses.
 HowtogetGSTIdentificationNumber?
 To get GSTIN, one has to submit the Form GST REG-01 along with the required
documents using the GST portal. After an officer performs a verification, GSTIN willbe
allocated to the applicant.
 What are the uses of GSTIN?
 GSTIN is one of the pre-requisites for starting a business. As per the GST law,
GSTINhas to be displayed at all places of businesses of a registered individual. Also, it hasto
be quoted during the process of raising invoices, while generating e-way bills,during GST
return filing, and during the submission of information to the taxdepartment.
 Can I hold multiple GSTIN’s or GSTnumbers?

 If a business operates from more than one state, the taxpayer can hold separate
GSTregistration for each state. For instance, If a textile company sells in Telangana
andDelhi, he has to apply for separate GST registration in Telangana and Delhi respectively.
Vendors correct any potential error in reporting GSTIN.

3.14 Goods and Services Tax Network (GSTN)-(includingtheRationale):

The Goods and Service Tax Network (or GSTN) is a non-profit, non-government
organization.This portal will be used by the government to track every financial transaction,
and willprovide taxpayers with all services – from registration to filing taxes and maintaining
all taxdetails.

51
What is GSTN (Goods and service Tax Network)?
The Goods and Service Tax Network (GSTN) is a non-profit, non-government
organizationwhichmanages theentire IT systemoftheGSTportal. Read morehere!
The Goods and Service Tax Network (or GSTN) is a non-profit, non-government
organization.It will manage the entire IT system of the GST portal, which is the mother
database foreverything GST. This portal will be used by the government to track every
financial transaction, and will provide tax payers with all services–from registration to filing
taxes and maintaining all tax details.

Structure of GSTN:
Private players own 51% share in the GSTN, and the rest is owned by the government.
Theauthorized capital of the GSTN is ₹10 crore (US$1.6 million), of which 49% of the
shares aredivided equally between the Central and State governments, and the remaining is
withprivate banks. The GSTN has also been approved for a non-recurring grant of Rs. 315
crores.The contract for developing this vast technological backend was awarded to Infosys in
-September 2015. The GSTN is chaired by Mr. Navin Kumar, an Indian Administrative
Serviceservant (1975 batch), who has served in many senior positions with the Govt. of
Bihar, andtheCentralGovt.
Shareholder Shareholding
CentralGoverment 24.5%
StateGoverment 24.5%
HDFCBank 10%
ICIC Bank 10%
NSEStrategicInvestmentCo 10%
LICHousingFinanceLtd 11%
Total 100%
TABLE3.3
Salient Features of the GSTN:
1. TrustedNationalInformationUtility:
The GSTN is a trusted National Information Utility (NIU) providing reliable, efficient and
robust IT backbonefor the smooth function in gof GST in India.
2. Handles Complex Transactions:
GST is a destination based tax. The adjustment of IGST (for inter-state trade) at

52
thegovernment level (Centre & various states) will be extremely complex, consideringthe
sheer volume of transactions all over India. A rapid settlement mechanismamongst the States
and the Centre will be possible only when there is a strong ITinfrastructure and service back
bone which captures, processes and exchanges information. Please read our article to know
more about how the Centre and theStates will settle IGST.
3. All Information Will Be Secure:
The government will have strategic control over the GSTN, as it is necessary to keepthe
information of all taxpayers confidential and secure. The Central Governmentwill have
control over the composition of the Board, mechanisms of SpecialResolution and
Shareholders Agreement, and agreements between the GSTN andother state governments.
Also, the shareholding pattern is such that theGovernment shareholding at 49% is far more
than that of any single privateinstitution.
4. Expenses WillB eShared:
The user charges will be paid entirely by the Central Government and the StateGovernments
in equal proportion (i.e. 50:50) on behalf of all users. The state sharewill be then apportioned
to individual states, in proportion to the number oftaxpayersinthestate.
Volumeofexpenses Typeofexpenses
Maximumexpenses ITsystemdesignedbyInfosys

2nd part FraudAnalyticsToolssecurityauditandother

securityfunctions(willbeoutsourcedbasedonten
der)
3rdpart Operating expenses such as salary, rent,
officeexpenses,internal ITfacilities
Functions ofGSTN:
GSTN is the back bone of the Common Portal which is the interface between the tax payers
and the government. The entire process of GST is online starting from registration to
thefiling of returns. It has to support about 3 billion invoices per month and the subsequent
return filing for 65 to 70 lakh tax payers.The GSTN will handle:

 Invoices
 Variousreturns
 Registrations
 Payments&Refunds

53
How Can Clear Tax Help You?
Clear Tax GST is a user-friendly, easy-to-use software. It is a cloud-based software (which
eliminates the need to download) which can easily be integrated with all existing accounting
software. All you need to do is upload or manually enter your invoices. The software will
automatically generate your GST returns and point out any errors in your invoices. It willalso
auto-reconcile your returns with those of your buyers and sellers and highlight
anydiscrepancies. Once you have verified your returns, simply click on submit and your
returnwill be filed on the Common Portal through one of our 5 GSPs. If you are worried
aboutissuing GST-compliant invoices, please use the ClearTax Bill Book which is
completely freeandwillhelpyoutogenerateGST-compliant invoicesinnotime.
FeaturesofGSTN:
 Ownership: It is partly owned by central government and partially by private
sectorbanksandotherinstitutions.
 Technology partner: Infosys was given the contract to develop this technological
back end of GSTN in September 2015.
 Management:Theteamof GSTN ischairedbyNavinKumar.
 Dynamic Nature: The main purpose behind implementing GSTN is to provide
acommononestop ITinterfacefor servingtheneedsofthe stakeholders.
SimplifiedStructureofGSTN:
The current GSTN structure has been adopted after the approval of the Finance Ministers of
states and the Union Government.
 GSTN’sequityshareof 51% is held by the private players and the rest of 49% is held
By the government (divided between the central and state government).
 Central government holding is much larger than the private holding, so this ensures
that the government thas a hold over this institution.
 Data of the tax payer is also in safe hands of the government and misuse of the same
is not possible.
GSTN is planning to introduce a new messaging facility for the dealers and sellers as
wellwherein both the parties will be able to converse with each other. GSTN has also signed
amemorandumof understandingwith IHMCLto linkFastagwith GSTe-waybillsystem.

54
Functions under taken by GSTN:
GSTN acts as a medium for the tax payers of the country and the Department to interact with
each other. It should also be noted that GSTN will not retain any part of the amountpaid as
tax. It is a portal which facilitates end to end compliance in accordance with GST Tax.GSTN
is also capable of handling the most complex IGST transactions.

3.15 GST Rates for different sectors (including the rationale):

GST is perhaps the biggest tax-related reform in India since Independence bringing
uniformity in the taxation structure and eliminating the cascading of taxes that was levied in
the past. The GST Council meets from time to time to revise the GST rates for various
products. Several states and industries recommend reduction in GST tax rate for various
items which are discussed in these meetings.
GST stands for Goods and Services Tax. Following are the various types ofGST.
 CGST–CentralGST
 SGST–StateGST
 IGST–IntegratedGST
At the time of GST implementation former Finance Minister, the late Mr. ArunJaitley said
that the government wanted tokeep the GST rates close to the original rates.But therewere
differences in case of some items because of the changes in the economy as well ascustomer
preferences. Some commodities were kept in the high tax bracket (18-28%) but
onscrutinizing the list, they found that these commodities should be considered as necessities
and not luxuries. This is why the GST rates were revised for commodities such as notebooks,
exercise books,

55
 GST Tax Rates on some common items:

TaxRates Products

0.25% Cutandsemi-polishedstonesareincludedunderthistaxslab.

5% Household necessities such as edible oil, sugar, spices, tea, and coffee
(exceptinstant) are included. Coal, Mishti/Mithai (Indian Sweets) and Life-
saving drugsare alsocoveredunderthis GST slab.
12% Thisincludescomputersandprocessedfood

18% Hairoil,toothpasteandsoaps,capitalgoodsandindustrialintermediaries are

coveredin this slab.
28% Luxury items such as small cars, consumer durables like AC and
Refrigerators,premiumcars,cigarettesandaerateddrinks,High-
endmotorcyclesareincluded
here.
TABLE:-3.4
Though edible items like sugar, tea and coffee are included in the 5% slab, milk does not
attract any tax under the new GST regime. The idea behind this is to ensure that basic food
items are available for everyone but instant food is keptout of this category.

 Basic household items like toothpaste and hair oil, which currently attract 28% tax,
will be taxed at18%only.

 Sweetswillalsobetaxableat5%.
 Tax rates on coal has also been reduced from 11.69% to just 5% in order to relieve the
pressure on power industries.
 GST also gives a major push to domestic industries as they will be able to procure
seamless input credit for capital goods. Make in India campaign is set to flourishafterthis
reform.

56
GSTRatesforGoods:

Fig 3.4
The government has proposed a 4-tier tax structure for all goods and services under theslabs-
5%, 12%, 18% and 28%. After the recent revision of GST rates, these are thecommodities
that fall under the four tax slabs along with those that do not attract any tax.Please note that
only those commodities are included in this list whose rates have beenrevisedinvarious
councilmeetings.

UPDATE: As per 37th GST Council Meeting, cut and semi-polished stones will be taxed
at0.25%GST.Thisis a5thGSTtier thatonlyincludesa fewproducts.

NoTax:
Apart from other items that enjoy zero GST tax rate, these are the commodities added to
thelist after11th June rate revision.

57
Hulledce real grains like Bones and horn- Palmyra jaggery Allt ypes of salt
barley, wheat,oat, rye, cores unworked and
etc. waste oft hese
products.
Kajal [other than kajal Picture Human hair – SanitaryNapkins
pencil sticks] books,colouring dressed,thinned,
books or drawing bleached orotherwise
books for worked
children
Vegetables preserved using MusicBooks/manusc Dicalcium Unit container-packed
various techniques including ripts Phosphate(DCP) of frozen branded
brine and other animal feed grade vegetables
preservatives that are conforming to IS (uncooked/steamed)
unsuitable for specificationNo.5470
immediate human :2002
consumption.

5%TaxSlab:
Given below are the items that have been added to the 5% GST tax rate slab
along with theother existing items:

Cashew nuts/cashew Iceandsnow Bio gas Insulin Marblerubble

nuts inshell
Aggarbatti and Kites Accessories/partsf Coirmats,matting and Pawan Chakki Natural cork
or carriages floor covering thatis Wind-based
designed for Atta Chakki
differently-abled
individuals
Postage or revenue Numismaticc Braille paper, Braille Fly-ashblocks Walking sticks
stamps,stamp- oins type writers, Braille
postmarks, first- watches, hearing aids
daycovers,etc. and other appliances to
compensate for ad efect
or disability

58
 12%Tax Slab:
After the GST council meeting on 11th June, the following items were added
to the 12% GSTrates category:

Preparations of Ketchups, Bari made of Menthol and menthol All diagnostic kits
vegetables, saucesand pulses crystals, peppermint, and reagents
fruits, nuts mustard sauce but including fractionated/deterpenated
orother parts of excluding mungodi mentha oil,dementholised
plants, including currypaste, oil, Menthapiperitaoil
pickle, murabba, mayonnaise and ands pearmintoil
chutney, jam, salad dressings,
jelly mixed condiments
and
Mixed dressings
Plasticbeads Exercise Glasses Spoons, forks, Fixed Speed
booksandnotebo forcorrectiv ladles,skimmers, cake DieselEngines
oks espectaclesa servers,fish knives,tongs
nd
flintbuttons
Two-way Intraocularlens Correctives Playing cards, Debagged/roughlys
radio(Walkie pectacles chessboard, carom board quared cork
talkie)used andother board games,
bydefence, likeludo,etc.
policeandparami
litary
forcesetc.
Itemsmanufact Agglomeratedc
uredfrom ork
naturalcork

59
 18%Tax Slab:

The items mentioned below have been added to the 18% GST tax rate slab
among the otherexistingitems:

Kajal pencil Dental wax Plastic Tarpaulin School Headgear and parts
sticks satchelsand bags thereof
otherthan of
leatheror
compositionleath
er; toiletcases,
Handbags
andshopping
bagsofartificialpl
astic
material,cotton
or jute;Handbags
ofother
materialsexcludi
ng
wicker work
orbasketwork
PrecastConcrete Salt Glazed Aluminiumfoil All Rear Tractor tyresand
Pipes StoneWarePipes goods,including rear tractor tyretubes
hooksandeyes
Rear WeighingMachin Printersotherthanmu Ball TransformersIndustria
Tractorwheel ery ltifunctionprinters bearing,Roller lElectronics
rim,tractor otherthanelectrico Bearings,Parts &
centrehousing, relectronicweighi relatedaccessorie
tractorhousingtra ngmachinery s
nsmission,tractor
support
front axle

60
ElectricalTra Static CCTV including Set top Box Computer
nsformer Converters(UPS) CCTVwithvideorecor forTV monitorsnot
ders exceeding 17inches

Electrical Electrical Perforating Baby carriages Instruments

Filaments or Filaments or orstapling formeasuring
discharge lamps discharge lamps machines(staplers), length,for use in the
pencilsharpeningm hand(for
achines example,measuring
rods
andtapes,micrometer
s,
callipers)
Bamboo Swimming pools Televisions/ Power banks Sports goods, games
furniture and paddling Monitors(upto32inches powered consoles and related
pools ) byLithium- items with HS code
ion batteries 9504
All items Usedorretreadedpn
withHS code eumatic rubbertires
8483 including
gearboxes,tran
smission
cranksand
pulleys

28%Tax Slab:
The council meeting was held to‘reduce’the tax rates on certain items based on customer
preferences.Hence,no additional items were added to the highest GST rates lab of28%.
*The GST rates for various products are subject to change from time to time without
priorinformation.

61
GSTRatesonServices:

Fig.3.5

Government has also imposed GST on Services with the same 4-tier tax structure as of
goods. GST rates on services comprising of 5%, 12%, 18% and 28% comes with various
prosand cons for the consumers. However, government has exempted healthcare and
educational services from the purview of the GST.
The Goods and Services Tax council has passed the rate slabs at NIL, 5%, 12%, 18%,
28%.Some of the services categorized under different slabsarementionedbelow:
Nil GST:
 Chargeable services offered on Basic Savings Bank Deposit (BSBD) account opened
under the PMJDY(PradhanMantriJanDhanYojana)
 Hotel accommodation for transaction value per unit per day being Rs.1000 orless
5%TaxSlab:

Working for Goods Renting a Transport Transport by air

printing of transported ina motor cab services in A (scheduled)/
news papers vessel from without fuel Ccontract/ airtravel for
outside India cost stageor radio purpose of
taxi pilgrimage
viachartered /non-
scheduled flights
Tour operator Leasing Print media
services ofaircrafts ad space

62
 12%Tax Slab:
Rail transportation Air travel Renting of Food /drinks at Railway
of goods excluding accommodation restaurants wagons,coaches, rolling
incontainers from economy for more than without stock(without refund of
a third party other Rs.1000andless AC/heating or accumulated Input
than than liquor license TaxCredit/ITC)
IndianRailways Rs.2500perday
Construction IP rights ona Movie Chit fund Hotel accommodation
ofbuilding for temporarybas Ticketsless than ervices by for transaction valueper
the purpose of is orequaltoRs.100 foremen unit per day ranging
sale between
Rs.1001to7500

18%Tax Slab:
Food/drinks at Food /drinks Outdoor Renting for Hotel accommodation
restaurants with atrestaurantswith catering accommodation or transaction value per
liquor license AC/heating for more than unit per day being
Rs.2500 but Rs.7501 or more
lessthan Rs.5000
perday
Circus,Indian Supplyofworks Movie Supply of food,
classical,folk, contract Tickets shamiyana,and
theatre, overRs. party
drama 100 arrangement

28%Tax Slab:
Entertainment events-amusement facility, waterparks, Race club Gambling
theme parks, joyrides, merry-go-round,race services
course,go-carting,casinos,ballet,sportingeventslikeIPL
Food/drinksatAC5- star hotels

63
GST on Loans and Advances:
Earlier Service Tax was levied on Loans which has now been replaced by GST which
wouldnow be levied on loans. The rate of Service Tax was 15% whereas the rate of GST is
18%. Alot of people are of the opinion that the effective cost of having a loan would increase
as therateof GST is3% higher than the rate of Service Tax.Several people are of the opinion
that their EMI’s would increase as the rate has been increased by3%.However, this is not the
Case as GST is not levied on repayment of loan or on payment of Intereston Loan.

GST is only levied on the processing charges and any other charges paid to the bank xcluding
the principal repayment and interest payment. These other charges include the Loan
Processing Fees, Loan Prepayment Charges and other charges, if any. As a major chunk of
the loan repayment comprises of principal repayment and interest payment, the impactof
GST on Loans would be very negligible. The impact of GST on Home Loans and Personal
Loans has been explained below for a much better understanding of the impact.

Mentioned below are the important loans and their GST rates:
(a) PersonalLoan-18%
(b) HomeLoans-18%
(c) CarLoan– 18%
GSTon Cars:
Subsequent to bringing cars under the GST regime, the GST rate on cars has been fixed
at28% for all personal use vehicles featuring a petrol or diesel driven engine. However,
inaddition to GST, a composition cess is also applicable to cars over and above the GST
Rate.Thus the overall tax rate applicable to vehicles under GST ranges from 29% to 50%.
Lowerrates of taxation are however applicable to cars driven by cleaner technologies such as
fuelcells (including hydrogenfuel cell) andelectricvehicles.
GSTonGold:
Subsequent to introduction of GST on items made from gold such as gold jewelry, thecurrent
GST rate on gold is 3%. However, a 5% GST rate is applicable to making chargesapplied to
gold jewelry in case the manufacturing is outsourced to a job worker. This canhowever, be
charged as input tax credit (ITC) by the jeweler and only a 3% GST charge isappliedtothe
finalbillpaid bythepurchaserof goldjewelryitems.

64
GST On Real Estate:
GST is applicable to real estate purchases only if you are purchasing an under construction
property. The GST rate applicable to such commercial or residential transactions is 12%
till31st March 2019. From 1st April, the applicable GST Rates on residential real estate will
be5% for non-affordable housing properties and 1% for affordable housing properties. No
GSTis applicable in case you are purchasing a ready to move in property. Additionally,
different GST rates are applicable to various building materials used in the construction of
houses/flats.This can range from5% (sand, marble rubble,etc.) to28% (cement,etc.).

GST on Food:
Food items especially fresh food mostly carry a Nil GST rate. However, packaged food stuff
and semi-processed/ processed foods do feature GST rates starting from5% upto18%.
While no food suffare currently included in the highest 28% GST bracket, the18%rate of
GST is applicable to some common food products such as chocolates as well as baked goods
such as cakes.
Upcoming products in GST Rates Slab:
The Government is going on with some new tactics to bring in some of the products under
GST system. As hinted by the former Finance Minister, the late ArunJaitley, there could be an
inclusion of products under GST with the reduction of GST rates on some products.
Major products which can come under GST rates slab includes:
1. Petroleumproducts-PetrolandDiesel
2. Land
3. Electricity
4. Others
Total Revisions in GST Rates:
Till date, there has been 37 GST council meetings till October 2019 in which the council
hasrecommended various relief measures regarding GST rates on goods and services.
GSTCouncil Meeting is chaired by the Finance Minister providing clarification
andrecommendation regarding various changes made in the GST rates of the goods
andservices.

65
GST Council Meetings:
Some of the important GST council meetings held till date are mentioned below:

37th GST Council Meeting: The 37th GST Council Meeting held on 20th September, 2019
led to various changes in GST laws for MSMEs, rates of certain goods and services. The
main decisions include waiver of GSTR-9 A filing for FY2017-18 and 2018-19. It also
announced the introduction of New GST Return System from April, 2020.

36th GST Council Meeting: The 36th GST Council Meeting held on 27th July, 2019
wasprimarily aimed to reduce GST rate on electric vehicles (12% to 5%). The GST rates on
electric vehicle chargers and charging stations were also reduced to 5% from 12%.
Moreover, the dead line for submission of forms CMP-08 and CMP-02 were extended.

35th GST Council Meeting: The 35th GST Council Meeting was held on 21st June, 2019
wasthe first to be conducted after the 2019 General Elections. The Council extended the
duedate to file annual GST returns. Additionally, the GST Council clarified that Aadhaar
OTP can be used for GST registration.

34th GST Council Meeting: The 34th GST Council Meeting held on 19th March, 2019
mainly focused on providing clarifications regarding the new real estate rates of 1% (for
affordable housing) and 5% (for non-affordable housing) applicable from 1st Apri l2019
onwards.
33rd GST Council Meeting: The 33rd GST Council Meeting held on 24th February,
2019introduced much anticipated rate cuts for the residential real estate sector with effect
from1st April, 2019. The announcement also provided clarity regarding the definition of
affordable housing.
Know about various GST rate changes proposed at the 31st GST Council meeting
32nd GST Council Meeting: The 32nd GST Council Meeting held on 10th January 2019
didnot feature any announcements in terms of GST rate rationalization however the
decisionsdid feature a focus on smaller businesses. One of the key decisions at this GST
Councilmeeting was the introduction of a GST composition scheme for
individuals/businessesproviding services or mixed services (other than restaurant services)
with a turnover limit ofRs. 50 lakhs with a tax rate of 6%. Additionally, the exemption for

66
other schemes registeredunder composition scheme was also increased to Rs. 1.5 crore from
the current level of Rs. 1crore (forplains states).

31st GST Council Meeting: The 31st GST Council Meeting held on 22nd December 2018
featured a number of rate changes in terms of goods and services. However no goods
orservices witnessed an increase in rates and the decrease in rates included tax rate change
from 5% to nil (packaged vegetables, etc.) as well as 12% to nil (music books). Some key
construction materials also witnessed a reduction in rates such as marble rubble (18% to5%)
and fly-ash bricks (12% to5%).

30th GST Council Meeting: The 30th GST Council Meeting was held on 28th
September2018 and one of its key highlights was an observed decrease in the revenue gap
under the GST regime as compared to the earlier VAT regime. One of the key reasons for
this increase was attributed to higher revenue collections from various northeastern states.
The councilalso discussed the imposition of a calamity cess to help distressed states that have
beenaffected by natural calamities such as floods. No GST rates of any products or services
werechangedatthis meeting.

29th GST Council Meeting: The 29th GST Council Meeting concluded on the 4th of
August2018. This time around no rate cuts were announced due to data suggesting low
GSTrevenue collections. However, the GST Council did propose the development of
amechanism to provide cashback of 20% on various digital transactions up to maximum
Rs.100 in order to promote cashless transactions. The decision was also taken to form a
panelto examine various tax and compliance relief proposals with respect to small taxpayers
and MSMEs.

28th GST Council Meeting: The 28th GST meeting held at New Delhi on 21st July, 2018
witnessed major changes in the GST rates in the country. The government has focused on
changes made in GST rates on various goods and services and also has simplified the GST
return filing mechanism.

67
1. GST Returns of Small tax payers
2. Simplified monthly returns
3. NIL Return filing by SMS
4. GST Migration Re-opened
5. Changesin GSTrates.

The council has brought down the tax rates to 18% from 28% on 15 items including vaccum
cleaners, washing machine, TV, paints and others. Sanitary napkins, Stone/marble, raw
materials for jhadoo and others have got their rates reduced to 0% i.e. exempted from GST.
Now only 35goods are in 28% bracket. This rates will be implemented from 27thJuly.

27th GST Council Meeting: Then Finance Minister ArunJaitley chaired the 27th GST
Council Meeting on Thursday, 18th Jan, 2018 where certain changes and recommendations
weremade through a video conference in New Delhi. In this meeting, various provisions were
made for B2B dealers, GSTR 3B and GSTR 1 filing to be continued same. Furthermore,
council also decided to look into the matter of cess in sugar as well as digital transactions.

26th GST Council Meeting: This GST meeting was held at VigyanBhawan, New Delhi on
10thMar, 2018. GST council primarily focused on exports, interstates movement of goods,
filing returns and others. The main agenda of the meeting was E-Way Bill, Simple Return
Filings, GSTR 3B deadline extension, Composition Scheme.

25th GST Council Meeting: On 18th Jan, 2018 GST council meeting was held at Vigyan
Bhawan, New Delhi. It focused on building some anti-evasion measures on GST. Some items
were re-considered under18% slab rate from 28% slab rate.

24th GST Council Meeting: The twenty-fourth meeting of GST Council was held on 16th
Dec,2017 through video conference. Agenda of the discussion was introduction of e-Way Bill
System by the given deadline, refund of provisionally accepted input tax credit.

23rd GST Council Meeting: 10th Nov, 2017 witnessed the 23rd GST council meeting
inGuwahati, Assam.This meeting focused on analysis of revenue, modification on rules of
Anti- Profiteering and GST Rates on certain items coming under 28% slab rates.

68
22nd GST Council Meeting: The 22nd council meeting decided that AC restaurant tax
raterevised to 12% from 18%. Major changes in the GST rates, businesses with turnover up
toINR 1.5 crore allowed to file quarterly returns, No GST on advances received by SMEs
were the key aspects discussed at GSTcouncilmeet.

21st GST Council Meeting: The 21st meeting was inaugrated in Hyderabad on 9th Sep,
2017.Council decided major changes in the tax rates from 18% to 12%. Also, due dates of
filing GSTR-1, GSTR-2,GSTR-3were extended.

1st and 2nd GST Council Meeting: The first meeting of GST council was held on 22-23
Sep,2016. It focused on rolling out GST on 1st Arril, 2017. It decided the regulation under
composition scheme and GST rates and threshold limit to pay taxes.The second meetingwas
held on 30th Sep, 2016. GST drafted rules for registration, payment process, returns, invoices
and other issues for the tax payers.

GSTRatesImpactonEconomy:
As GST has transformed the economy at its peak. It’s a game-changing reform for the
Indianeconomy as it brings about net appropriate price for the goods and services considered
under single taxation system. Mentioned below are some of the important GST rates impacts
in the Indian economy :

1. Increase in Competition: After the GST has been imposed, there has been seen a
fallin prices of goods and services which ultimately has brought the final consumer tohave
less tax burden on the goods and services. There is seen a great scope of increased
production, thus, increase in competition.
2. Simple Tax Structure: GST has simplified the calculation of tax with the adoption
ofsingle taxation system. Under this, multiple taxation has been aborted which ultimately
saves time and money.
3. Uniform Tax Regime: Previously, there used to be multiple tax at every stage
ofsupply chain, where the taxpayer got confused. But now, with GST, it is easier for the tax
payer to pay uniform tax.
4. Increase in Exports: There has been seen a fall in the cost of production after the
GSTgot imposed. This in return has brought competitiveness towards the international
market resulting in rise in exports.

69
Protest against GST rates:
With the implementation of GST, various traders, cloth merchants, private security agencies
and many others went on protest against GST rates. Cloth merchants protested against
theimposition of 5% sales tax on textiles under the GST regime. The newly added tax system
inthe country also made the iron, wire dying and steel traders to held a protest against
highrates of GST. Steel traders were of opinion that the new tax system has nosedived 40%
trade due to high rates and elaborated paper works under the new system.

Owners and employees of private security agencies also went on a silent protest against
thelevy of 18% GST on security services because the GST rate took away the major share of
wage and benefits from the security personnel.

3.16 Analyse how GST has affected the private transport sector in india:
Growth\ decline of the sector since the GST simplementation:
GST the biggest tax reform in India founded on the notion of “one nation, one market,
onetax” is finally here. The moment that the Indian government was waiting for a decade
hasfinally arrived. The single biggest indirect tax regime has kicked into force, dismantling
all the inter-state barriers with respect to trade. The GST rollout, with a single stroke, has
converted India into a unified market of 1.3 billion citizens. Fundamentally, the $2.4-trillion
economy is attempting to transform itself by doing away with the internal tariff barriers and
subsuming central, state and local taxes into a unified GST. The rollout has renewed the hope
of India’s fiscalre form program regaining momentum and widening the economy.
Then again, there are fears of disruption, embedded in what’s perceived as a rushedtransition
which may not assist the interests of the country. Will the hopes triumph overuncertainty
would be determined by how our government works towards making GST a“good and
simple tax”. The idea behind implementing GST across the country in 29 statesand7 Union
Territories is that it would offer a win-win situation for everyone.
Manufacturers and traders would benefit from fewer tax filings, transparent rules, and easy
book keeping; consumers would be paying less for the goods and services, and the
government would generate more revenues as revenue leaks would be plugged. Ground
realities, as we all know,vary.So, howhas GSTreally impacted India?Let’s take alook.

70
The difference in the % of tax the sector pays before and after the
GSTimplementation:

Pre-GST, the statutory tax rate for most goods was about 26.5%, Post-GST, most goods are
expected to be in the 18% tax range. The tax came into effect from 1 July 2017 through the
implementation of the One Hundred and First Amendment of the Constitution of India by the
Indian government.
ST or Goods and Services Tax replaced a slew of central and state levies from July 1. For
themonth of July, firms are required to file simplified, self-assessed GST returns by August
20.They will have to file complete returns in early September that itemise and reconcile
every single sales invoice. Amid all this, the Central Board of Excise and Customs has once
again listed some common-use items - and their pre-GST tax rates - where the tax incidence
is lower or equal ever since GST came into effect. It has mentioned several "items of
common use" comparing GST rates with the earlier indirect taxes.
"The pre-GST tax incidence would be higher if the tax incidence on account of CST
(CentralSales Tax), octroi, entry tax etc. (which is more than 2 per cent) is also included,"
said the CBEC,part of the revenue department under the finance ministry.
For example, items that now attract nil taxes under GST include wheat/rice, unbrandedflour,
curd, butter milk, unbranded natural honey and children's drawing books. The earlier tax
incidence on such items was in the range of 2.5-7 percent, according to the CBEC.Also,
items such as UTH (ultra high temperature) milk, tea, milk powder, sugar, vegetable edible
oils, spices and footwear (priced up to ₹ 500) will attract taxes of 5 per cent under
GST,compared with the earlier tax incidence of 6-10 per cent.

Theimpact oftheGSTmodeland process,and howthe sectoradapted:

1) CGST: – Under this option, the two levels of government would combine their
leviesin the form of a single National GST, with appropriate revenue sharing arrangements
among them. In the case of a Central GST (where all goods and services are taxed bythe
Central government only), the Centre will collect most of the country’s total taxrevenue,
leaving verylittle for the sub national Governments.
2) SGST: – The second model is to have a State GST in which the States alone levy
GSTand the Centre withdraws from the field of GST or VAT completely. In this case,
theState GST will work as the redistributing mechanism. The loss to the Centre from

71
vacating this tax field could be offset by a suitable compensating reduction in fiscal transfers
to the States. This would significantly enhance the revenue capacity of the States and reduce
their dependence on the Centre.

3) DualGSTModel:

a) Non-Concurrent Dual GST: -Under this model, GST on goods can be levied by the
States only and on services by the Centre only. The States already have the power tolevy the
tax on the sale and purchase of goods (and also on immovable property), and the Centre for
taxation of services. No special effort would be needed for levyinga unified Centre tax on
inter state services. This model of dual GST would not be acceptable to the Centre as well as
the States. Hence, the Government has alreadyannounced its intention to follow the
Concurrent DualGST.
b) Concurrent Dual GST :- It consist of both the Central GST and State GST levied
onsame base. Under this model, GST will be levied by both tiers of
Governmentsconcurrently. There will be Central GST to be administered by the
CentralGovernment and there will be State GST to be administered by State Governments.In
this model, both goods and services would be subject to concurrent taxation bythe Centre and
the States. All types of goods and services will be brought under thisproposed GST structure
except few exceptions. India and Canda follow the Concurrentdual GSTmodel.
For Example, if a product has a cost of Rs. 10,000 and rate of CGST and SGST are 9%then
in such case both CGST and SGST will be charged on Rs. 10,000 i.e. CGST will beRs900/-
and SGST will be Rs.900/-

72
 CHAPTER 4
DATAANYALSISANDINTERPERTATION

1. GENDER OF THE RESPONDANT:INFORMATION

TABLE :4.1ABOUTTHEGENDER:
GENDER NOOFRESPONDENTS PERCENTAGE
MALE 48 46.6%
FEMALE 50 48.5%
PREFERNOTTOSAY 5 4.9%
OPTION4 - -
TOTAL 103 100

PIE CHART:-4.1

DATAANAYALSIS:
From the above piechart 46.6% respodents are male and 48.5% respodents
arefemaleand4.9%respodentsareprefernotto say.

INTERPRETATION:
Majority of the respondents are femalei.e, 48.5%.

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2. AGEOFTHERESPONDANT:

TABLE:4.2INFORMATIONABOUTAGEOFTHEEMPLOYEE:

AGEOFEMPLOYEE NOOFRESPONDENTS PERCENTAGE

UNDER18 7 6.8%
18-25Years 54 52.4%
26-30Years 37 35.9%
31-40Years 5 4.9%
Total 103 100

PIE CHART:-4.2

DataAnalysis:
From the above pie chart 6.8% respodents are under 18 years ,4.9% respodents are under18-
25 years,35.9% respodents are under 26-30 years, 52.4% respodents are under 31-40 years.

INTERPRETATION:
Majoraityofthe respondents ie. 52.4% belonges to18-25yearsofage.

74
 3. CURRENT EMPLOYMENT OF THE RESPONDANT
4.3 TABLE: INFORMATIONABOUTCURRENTEMPLOYMENTSTATUS:
CUREENT NO OF PERCENTAGE
EMPLOYMENTSTATU THERESPON
S DENTS
FULLYEMPLOYED 57 55.3%
PARTLYEMPLOYED 10 9.7%
STUDENT 36 35%
RETIRED - -
TOTAL 103 100

Pie chart:-4.3

DataAnalysis:
From the above pie chart 35% respodents are fully employed,9.7% respodents are partly
employed, 55.3% respondents are students.

INTERPRETATION:
Majoraity of the respondents are fully employed i.e,55.3%

75
4.Income of the employee of the Respondant:

TABLE:- 4.4 INFORMATION ABOUT INCOME OF THE EMPLOYEE:

INCOME OF NO OF THE PERCENTAGE

THE RESPONDENTS
EMPLOYEE
2-3 lakhs 40 38.8%
2-4 lakhs 17 16.5%
3-4lakhs 30 29.1%
4-5lakhs 16 15.5%
Total 103 99.9%

Pie chart:-4.4

Data Analysis:
From the above pie chart 38.8% respondents have 2-3 lakhs of income, 16.5%respondents
have 2-4 lakhs of income respondents, 29.1%respondents have 3-4 lakhs ofIncome ,15.5%
respondents have 4-5 lakhs of income.

INTERPRETATION:
Majority of the respondents have 2-3 lakhs of income.

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5.EDUCATIONALQUALIFICATIONOFTHERESPONDANT:

TABLE:- 4.5 InformationAboutEducationalQualifaction:

EducationalQualifaction NOOFTHERESPONDENTS PERCENTAGE

SecondarySchool 21 20.4%
Degree 34 33%
Diploma 3 2.9%
Postgraduation 39 37.9%
Others 6 5.8%
Total 103 100

Pie chart:-4.5

DataAnalysis:
From the above pie chart20.4% respondents areSecondary School, 33% respodents are
degree, 2.9% respondents are diploma,37.9%arepost graduation,5.8% are others.

INTERPRETATION:
Majority of the respondents are post graduation i.e,37.9%.

77
 6. The private transport services has increased implementation of GST of

theRespondant:
TABLE:-4.6
InformationabouttheprivateserviceshasincreasedimplementationofGST:

Demensions NO OFTHERESPONDENTS PERCENTAGE

Strongaly agree 16 15.5%
Disagree 4 3.9%
Netrual 27 26.2%
Agree 35 34%
Stronglyagree 21 20.4%
TOTAL 103 100

Pie chart:-4.6

DataAnalysis:
From the above pie chart 15.5% respondents are strongly disagree, 3.9% respondents are
disagree , 26.2% respondents are netural , 34% respondents are agree ,20.4% respondents are
strongly agree.

INTERPRETATION:
34% of the respondents agree with the fact that the price of the private transport services has
increased drastically after the implementation of GST.

78
7.The tax amount of service/on the bill and more of the implementation
ofGSToftheRespondant:
TABLE:-4.7 Informationabouttaxamount ofservicesonthebill ofGST:-

Demensions NOOFTHERESPONDENTS PERCENTAGE

Stronglydisagree 11 10.7%
Disagree 7 6.8%
Neutral 9 8.7%
Agree 50 48.5%
Stronglyagree 26 25.2%
TOTAL 103 100

Pie chart:- 4.7

DataAnalysis:
From the above pie chart 10.7% Respondents are strongly disagree, 6.8% Respondents are
disagree, 8.7%respondents are neutral, 48.5% Respondents are agree, 25.2% Respondents are
strongly agree.

INTERPATION:
48.5% of the respondents agree with the fact that the tax amount on a
service/on the bill, a lot of more
After the implementation of GST .

79
8.GSTwillabolishallthedirecttaxleviedinindiaoftheRespondant:
Table:4.8InformationaboutGSTwill
Abolish all the direct tax levied in india:
Demensions NO OFTHERESPONDENTS PERCENTAGE
Stronglydisagree 18 17.5%
Disagree 9 8.7%
Netrual 9 8.7%
Agree 47 45.6%
Stronglyagree 20 19.4%
TOTAL 103 100

Pie chart:-4.8

Dataanalysis:
From the above pie chart 17.5% respondents are strongaly disagree,8.7% respondents are
disagree,8.7% respondents are neutral,45.6% respondents are agree , 19.4% respondents are
strongly agree.

Interpation:
45.6% of the respondents agree with the GST will ablolish all the indirect taxes.

80
9.The following tax will be abolished by the GST of the Respondant:
Table:4.9Informationabouttaxwillbe abolishedbytheGST:
Demensions NOOFTHERESPONDENTS PERCENTAGE
ServiceTax 59 57.3%
CorporationTax 15 14.6%
IncomeTax 25 24.3%
Wealth Tax 4 3.9%
TOTAL 103 100

WealthTax
TOTAL 103 100

Pie chart:-4.9
DATA ANALYSIS:-
From the above pie chart 57.3% respondents are service Tax, 14.6% respondents
arecorporationTax,24.3%respondnetsareIncomeTax,3.9%respondentsarewealthTax.

Interpation:
Majority of the respondents feels that service tax will be ablolised after the implementation of
GSTi.e,57.3%.

81
 10.The following is the main motive of the government behind Introduction
of the GST of the respodant:
Table:4.10 Information about the main motive of the government behind
the GST:
Demensions NOOFTHERESPONDENTS PERCENTAGE

To increases 34 33%
Governmentrevenue
TObringuniformityinthe 17 16.5%
country
Toreplacealltheindirect 9 8.7%
taxes
Alltheabove 43 41.7%
TOTAL 103 100

Pie Chart:4.10

Dataanalysis:
From the above pie chart 33%respondents are To increase Government
revenue,16.5%respondents are To bring uniformity in the country,8.7% respondents are To
replace all the indirect taxes,41.7% respondents are all the above.

Interpation:
Majorityoftherespondents says that all the three motive are important for the government to
implement GST in india,i.e 41.7% .

82
 11.Which system do you think is more benefical to government and people

of Respodant:-
TABLE:-4.11 Information about which is more beneficial to government
and people:

Demensions NOOFTHERESPONDENTS percentage

GST 44 42.7%
Salestaxandservicetax 11 10.7%
Corporatetaxandwealthtax 6 5.8%
Alltheabove 42 40.8%
TOTAL 103 100

Pie chart:-4.11
Dataanalysis:

From the above pie chart 42.7% respondents are GST, 10.7% respondents are sales and
services tax,5.8% respondents are corporate tax and wealth tax,40.8% are all the above.

Interpation:

Majority of the respondents feels that service tax will be ablolised after the implementation of
GST i.e,57.3%.

83
12.The tax system is all about balance between min compliance cost and
maxtheGSTofthe Respondant:

Table:-4.12 Information about the tax system balance

between min compliance cost andmaxtheGST:

Demensions NOOFTHERESPONDENTS percentage

Stronglydisagree 18 17.5%
Disagree 6 5.8%
Neutral 13 12.6%
Agree 48 46.6%
Stronglydisagree 18 17.5%
TOTAL 103 100

Pie chart:-4.12

Dataanalysis:

From the above pie chart 17.5% respondents are strongly disagree,5.8% respondents are
disagree,12.6%respondentsareneutral,46.6% respondents are strongly agree.

Interpation:

46.6% of the respondents agree with the balance between minimizing compliance cost and
maximizing with the GST.

84
13.on a scale of 1to5, how much do you support GST on the private
transport sector of the respondant:

Table:-4.13 Information about how much do you support GST on the

private transportunderthescale1to5:

Scale NO OFTHERESPONDENTS percentage

1 3 2.9%

2 4 3.9%

3 27 26.2%

4 60 58.3%

5 9 8.7%

TOTAL 103 100

Graph :-4.13

Dataanalysis:

From the above bar graph 2.9% respondents of scale1,3.9% respondents of scale 2,26.2%
Respondents of scale3,5 8.3% respondents of scale4,8.7respondents of scale5.

Interpation:

Majority of the respondents i.e.,58.3% agree that GST will support the private transport
sector.

85
14.Is GST only applicable in india of the respondant:

TABLE:-4.14 InformationAboutisGSTonlyapplicableinIndia:

Demensions NO OFTHERESPONDENTS percentage

Yes 62 60.2%
No 26 25.2%
Maybe 15 14.6%
TOTAL 103 100

Pie chart:-4.14
DATAANALYSIS
From the above pie chart 60.2%respondents are givenyes, 25.2% respondents are no,
25.2%respondents are may be.

INTERPATION:

Majority of the respondentsi.e, 60.2% say that GST is applicate only in india only.

86
 15.How do you get to know about GST of the respondant:
TABLE:4.15 Information about how do you get to know about GST
Demensions NO OFTHERESPONDENTS percentage

Friends 27 26.2%
Massmedia 12 11.7%
Online 48 46.6%
Others 16 15.5%
Totals 103 100

Pie chart:-4.15
DATAANALYSIS

From the above pie chart 26.2% respondents Are friends,11.7% are respondents are mass
friends,46.6% respondents are online,15.5%respondents are others.

INTERPATION:

Majority of the respondents i . e , 46.6% of them got to know about GST via online sources.

87
16.Private transport sector can be benefitted from GST Of the respondant:
Information about private transport sector canbe benefitted fromGST:

Demensions NO OFTHERESPONDENTS percentage

Stronglydisagree 22 21.4%
Disagree 5 4.9%
Neutral 10 9.7%
Agree 50 48.5%
Stronglyagree 15 15.5%
TOTAL 103 100

Pie chart:-4.16

DATAANALYSIS

From the above pie chart 21.4% respondents are strongly disagree,4.9%respondents
aredisagree, 9.7% respondents are neutral,48.5% respondents are agree, 15.5%
respondentsare stronglyagree.

INTERPATION:
Majority of the respondents i.e, 48.5% of the agree that the private transport sector can be
benefitted From GST.

88
 17. IS GST applicable on private transport sector of the respondant
Table:-17 Information about GST applicable on private transport sector
Demensios NO OF THE perce Expectedva O-E (O-E)2 (O-E)2/
RESPONDENTS ntage lue=103/3 E
Yes 70 68% 34.3 35.7 1274.49 37.15

No 24 23.3% 34.3 10.3 106.09 3.09

Maybe 9 8.7% 34.3 25.3 640.09 18.66

Total 103 100 - 71.3 2020.67 58.9

NULL Hypothesis(HO): GST applicable does not impact on private transport sector.
Alternate Hypothesis(HI):GST applicable impact on private transport sector.
Significance=0.05=Alpha
Degree of Freedom=Number of Buckets-1=3-1=2
Expected Value =Mean of the Observed Values
Expected Value =103/3=33.3%
Since CV>TV,Null Hypothesis is Rejected->H1 is Accepted.

Pie chart:-4.17

DATAANALYSIS:

From the above pie chart 68% respondents are given yes , 23.3%
respondents areno,8.7%respondentsaremay be.
INTERPATION:
68% of the respondents YES ( agree) with the fact that GST is applicable on private
transport sector.
89
 18.what is the precentageof GST on the private trasnsport sector of the
respondant:
TABLE:- 20 InformationaboutpercentageofGSTonthe private transport
sector:
Demensions NO OFTHERESPONDENTS percentage

5% 58 56.3%
10% 19 18.4%
15% 22 21.4%
18% 4 3.9%
TOTAL 103 100

Pie chart:-4.18

Dataanyalsis:

From the above piechart 56.3% respondents are 5% ,18.4% respondents are 10%,21.4%
Respondents are 15%, 3.9% respondents are18%.

INTERPATION:

Majorityoftherespondentsi.e,56.3% say that the percentage of GST on private transport

sector 5%.

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 19.What service of transportation of the goods is exempt under GST of
therespondant:

TABLE:-4.19
InformationaboutserviceoftransportationofthegoodsunderGST:

Demensions NO OFTHERESPONDENTS percentage

Acourieragency 49 47.6%
Agoodtransportation 34 33%
agency
Trans-shipmentagency 15 14.6%
Ware houseagency 5 4.9%
TOTAL 103 100.1

Pie chart:-4.19

Dataanyalsis:

From the above pie chart 47.6% respondents are A courieragency,33% respondents are A
good transportation, 14.6% respondents are Trans-shipment agency, 4.9% are Ware house
agency.

INTERPATION:

Majority of the respondentsi.e, 47.6% A courier agency agreed with the service of
tranporation of the goods is exempt under GST.

91
 20. Is a GTA goods Transport liable to register of the Respondant
TABLE:4.20 Information about Is a GTA goods transport liable to
register:
NO OF percentage Expected O-E (O-E)2 (O-
Demensions THERESPON value=103/3 E)2/E
DENTS
Yes 66 64.1% 33.33 32.67 65.34 1.96
No 21 20.4% 33.33 12.33 24.66 1.35
Prefer not 16 15.5% 33.33 17.33 34.66 0.96
tosay
TOTAL 103 100 - 62.33 125.66 4.27
Null Hypothesis:GTA goods transport does not impact on liable to register.
FULL Hypothesis:GTA goods transport impact on liable to register.
Significance= 0.05=Alpha.
Degree of freedom=Number of Bucket-1=3-1=2
Expected Value=Mean of the observed Values
Expected Value= 103/3= 33.3
Since CV>TV,Null Hypothesis is Rejected ->H1 is Accepted Pie chart:-4.20

Dataanyalsis:

From the above pie chart 64.1% respondents are given yes ,20.4%
respondents are given no15.5%respondents aregivenprefernottosay.

INTERPATION:
64.1% of the respodents yes (agree)with the fact that GTA liable to register.

92
 CHAPTER 5
FINDINGS, SUGGESTIONS AND CONCLUSION

FINDINGS:
After collection of data from 103 individuals the views expressed by the respondents
have been significant .
Some of the views expressed by them about the assessment of the effect of GST on private
transport sector.
 Majority of the respondents are female i.e, 48.5%.
 Majoraity of the respondents ie. 52.4% belonges to 18-25 years of age .
 Majoraity of the respondents are fully employed i.e,55.3%
 Majority of the respondents have 2-3 lakhs of income.
 Majority of the respondents are post graduationi.e, 37.9%.
 34% of the respondents agree with the fact that the price of the private transport
services has increased drastically after the implementation of GST.
 48.5% of the respondents agree with the fact that the tax amount on a service/on the
bill, a lot of more After the implementation of GST .
 45.6% of the respondents agree with the GST will ablolish all the indirect taxes.
 Majority of the respondents feels that service tax will be ablolised after the
implementation of GST i.e,57.3%.
 Majority of the respondents says that all the three motive are important for the
government to implement GST in india,i.e 41.7% .
 Majority of the respondents feels that service tax will be ablolised after the
implementation of GST i.e,57.3%.
 46.6% of the respondents agree with the balance between minimizing compliance cost
and maximizing with the GST.
 Majority of the respondents i.e.,58.3% agree that GST will support the private
transport sector.
 Majority of the respondentsi.e, 60.2% say that GST is applicate only in india only.
 Majority of the respondents i.e,46.6% of them got to know about GST via online
sources.

93
 Majority of the respondents i.e, 48.5% of the agree that the private transport sector
can be benefitted
From GST.
 68% of the respondents YES ( agree) with the fact that GST is applicable on transport.
 Majority of the respondents i.e,56.3% say that the percentage of GST on private
transport sector 5%.
 Majority of the respondentsi.e, 47.6% A courier agency agreed with the service of
tranporation of the goods is exempt under GST.
 64.1% of the respodents yes (agree)with the fact that GTA liable to register.

94
 SUGGESTIONS:
 Relief must be given to small scale operators and particularly reduced processes
should be applicable to them. They do not have finance or resource to comply. Much of
India‟s business is one or two man show. The facility to file quarterly returns should be
extended to assessees with up to 10 crore turnover.

 Rates should be rationalized and reduced to make India competitive and in interest of
compliance and economic growth. The highest rate should be kept at 18% and there should
be only few items that fall in 28% slab. Daily use items such as soaps, crèmes, movie tickets,
electrical goods should not be taxed at 28%

 Technological glitches of the GST network should be sorted out on a war footing
basis

 Further, there is also no provision to amend GST Return once uploaded, in case some
clerical error is found later. Provision should urgently be made to allow rectification of
returnshow. The facility to file quarterly returns should be extended to assessees with up to
10 crore turnover.

 Processes must be reduced so that business can operate efficiently in the best interest
of the people and for economic growth. Filing of 37 returns per GSTINcouldbe a very time
consuming exercise, wherein everyone would not even have thebandwidth to comply with.

 The matching concept of input credits requires large volume of data of the supplier to
be matched with that of the receiver. This process should be simplified, wherein only broad
main criteria may require matching like the invoice value and the tax amount and matching of
specific, precise wide variety of data should not be required like invoice number and date.

 Valuation Rules lack clarity and are debatable. This is likely to lead to litigation and
transfer pricing issues / litigation. These rules need to be rationalized, simplified and be fair
to one and all.

 In case IGST is paid instead of CGST and SGST, and vice-versa, the recourse
available is only refund. Assesses should be allowed to self-adjust in such cases.

 In respect of capital goods received on or after 01.07.2017 (Capital goods in transit),

transitional credit of tax paid in earlier regime should also be available. Transitional input
credit should also be available on goods or services are delivered or received before the
appointed date and the assessee received the invoices after appointed day.

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 Credit of KrishiKalyanCess should be allowed to be carried forward as eligible credit,
as it was allowed as set off in the service tax regime.

 Registration for All Traders & Service Providers, with Exemption, for Small Scale
Suppliers from Collecting & Remitting GST

 Exemption (Threshold) Limit May Cover Inter-State Sale also

 Abolition of Casual Trader Category

 Single Point Registration and One GST Regn.No. for PAN-India Operations.

 Free Billing Software from GSTN and Invoice Format

 Free Purchase Register Software From GST Network & Register Format.

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CONCLUSION:

Under GST, Services sector hasaccepted thechangesmade under GST by the

government of India. Moreover, buses (including mini buses) caring more than 10
individuals, will besubject Ed to no extra cess. The implementation of GST in the transport
sector has been primarily positive, which is due to improve over time. As compliance
increases in the industry and efficiency optimised, India has a chance to compete globally
with decreases logistic costs. But for this study in transportation sector in Sagar region
theyare fixes the prices on the basis of trip, capability and route.And usually GST collecting
the tax in monthly and quarterly ofthe year but inthe road transportation sectors are paying
thetax in yearly once.. Before introducing the GST the few owners are not follow the service
tax but now no chance to made any fake or illegal reports and other thing is for the GST the
product prices alsoincreases that’swhy the transportationownersincreases theirserviceprice.
Generally, implementationofGST isuseful for the servicesectors butso The above discussion
shows that not all transport of goods by road is by a GTA. To qualify asservices of GTA, the
GTA should be necessarily issuing a consignment note. Only services provided bya GTA are
taxable under GST. Services of transportation of goods by a person other than GTA are
exempt.

The above discussion shows that not all transport of goods by road is by a GTA. To qualify
as servicesof GTA, the GTA should be necessarilyissuing a consignment note. Only services
provided by a GTAare taxable under GST. Services of transportation of goods by a person
other than GTA are exempt.Moreover, in cases where the service of GTA is availed by the
specified categories of persons in thetaxable territory, the recipients who avail such services
are the ones liable to pay GST and not thesupplier of services unless the GTA opts for
collecting and paying taxes @ 12% (6% CGST + 6% SGST).In all other cases where GTA
service is availed by persons other than those specified, the GTA servicesupplieris the person
liable to pay GST. The GTA service supplieris not entitled to take ITC on input services
availed by him iftaxis being charged @5%(2.5%CGST +2.5%SGST). In casetheGTAservice
supplier hires any means of transport to provide his output service, no GST is payable on
such inputs.

Moreover, in cases where the service of GTA is availed by the specified categories of
persons in thetaxable territory, the recipients who avail such services are the ones liable to
pay GST and not thesupplier of services unless the GTA opts for collecting and paying taxes

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@ 12% (6% CGST + 6% SGST).In all other cases where GTA service is availed by persons
other than those specified, the GST onthose services has been exempted. The GTA service
supplier is not entitled to take ITC on inputservices availed by him if tax is being paid by
recipient under reverse charge @ 5% (2.5% CGST +2.5% SGST). In case the GTA service
supplier hires any means of transport to provide his outputservice, no GST is payable on such
input service as the same is exempted.meof he transportation owners are not ready to accept
the GST.

The concept of RCM on GTA was also there under service tax. Pure transportation of
goodsservices is mostly provided by unorganized sector and hence they have been
specificallyexcluded from the tax net. In respect of GTA, the liability to pay GST falls on the
recipients under reverse charge in most of the cases. However, the GTA may opt to pay
under forward charge. However, transporters were confused in the beginning due to the law
“persons who are required to pay tax under reverse charge” have to be compulsorily
registered.
Transporters refused unregistered dealers because they were afraid they would have to
register.The government issued more clarifications & FAQ saddressing the GTA on this,
reduce such confusions. Are you a GTA? Are you confused about whether you are liable to
register today? Talk to an expert today. we also have Clear Tax Bill Book to help you to
issue GST compliant tax invoices or bill of supply as the case maybe.

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 Chapter - 6

BIBLOGRAPHY:
MAGAZINES/ NEWS PAPERS:

 Economic Times.

 Business Line.

 Business Standards.

WEB SITES:

 PawanKumar,DilipKumar
 Asian Journal of Management 11 (4), 535-538, 20202.Dr Kumar
 Nishi Shubhita Rakesh, Shreya Nanda,
SmitaMehendaleAsianJournal ofManagement9(1),829-833,2018
 AbbasValadkhani,AllanP Layton
 AustralianEconomicReview37(2),125-138,2004
 Pushpendu Chand, Jitesh J Thakkar, KunalKanti
GhoshResourcesPolicy68,101726,2020

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 CHAPTER 7

APPENDIX:

1. Whatisyourgender?

 Male
 Female
 Pefernottosay
 Option4

2. Age of the employee?

 Under18
 18-25years
 26-30years
 31-40years

3. What is your current employment status?

 Fully employed
 Partly employed
 Student
 Retired

4. Income of the Employee (per annum)

 2-3lakhs
 2-4lakhs
 3-4lakhs
 4-5lakhs

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5. Educationalqualification?

 Secondary School
 Degree
 Diploma
 Postgraduation
 Others

6. The price of the private transport service has increased drastically after
theimplementation ofGST:

 Strongly disagree
 Neutral
 Agree
 Strongly agree

7.I Notice the tax amount on a service / on the bill, a lot of more after the
implementation of GST:

 Strongly disagree
 Disagree
 Neutral
 Agree
 Strongly agree

8. GST will abolish all the direct tax levied in india.

 Strongly disagree
 Disagree
 Neutral
 Agree
 Strongly agree

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9. Which of the following tax will be abolished by the GST?

 ServiceTax
 CorporationTax
 IncomeTax
 WealthTax

10. Which of the following is the main motive of the Government behind the introduction
of the GST?

 To increase Government revenue

 To bring uniformity in the country
 To replace all the in direct taxes
 All the above

11. Which system do you think is more beneficial to both government and people.

 GST
 Salestaxandservicetax
 Corporatetaxandwealthtax
 Alltheabove

12. The tax system is all about balance between minimizing compliance cost and
maximizing with the GST.

 Stronglydisagree
 Disagree
 Neutral
 Agree
 Stronglyagree

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13. On a scaleof 1to5,how much do you support GST on the private transport sector?

Unlikely

 1
 2
 3
 4
 5

VeryLikely

14. Is GST only applicable in India.

 Yes
 No
 Maybe

15. How do you get to know about GST?

 Friends
 MassMedia
 Online
 Others

16. Private transport sector can be beneffitted from GST?

 Strongly disagree
 Disagree
 Neutral
 Agree
 Strongly agree


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17. Is GST applicable on transport?

 Yes
 No
 Maybe

18. What is the percentage of GST on transport sector?

 5%
 10%
 15%
 18%

19. What service of transportation of the goods is exempt under GST?

 A courier agency
 A goods transportation
 Trans-shipmentagency
 Ware house agency

20 . Is a GTA liable to register?

 Yes
 No
 Prefer not to say

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