University of Mumbai

Impact Of Gst On Small And Medium Enterprises

A Project Submitted to

University of Mumbai for partial completion of the degree of

Master of Commerce

Under the Faculty of Commerce

By

YADAV RAKESH VIJAYSHANKAR

Under the Guidance of

PROF. Priydarshan Sir

Sree Narayana Guru College of Commerce

PL Lokhande Marg Chembur (W), Mumbai, Maharashtra 400089
 DECLARATION

I the undersigned YADAV RAKESH VIJAYSHANKAR here by, declare that the work embodied in
this project work titled forms my own Indirect Impact Of Gst On Small And Medium
Enterprises- contribution to the research work under the guidance of “Prof. Priydarshan Sir” a
result of my own research work and has not been previously submitted by any other university for
any other degree/diploma to this or any other university. Wherever reference has been made to
previous work of other, it has been clearly indicated as such and included in the bibliography I, here
by further declare that all information of this document has been obtained and presented in
accordance with academic rules and ethical conduct.
 SREE NARAYANA GURU COLLEGE OF COMMERCE
PL LOKHANDE MARG CHEMBUR (W), MUMBAI, MAHARASHTRA 400089

CERTIFICATE

This is to certify that YADAV RAKESH VIJAYSHANKAR has worked and duly Completed his Project
Work for the degree of Master of Commerce Studies under the Faculty of Commerce in the subject of and his

project is entitled, “Impact Of Gst On Small And Medium Enterprises- Under my supervision

I further certify that the entire work has been done by the learner under my guidance and that no part of it
has been submitted previously for any Degree or Diploma of any University.

It is her/ his own work and facts reported by her/his personal findings and investigations.

“Prof. Priydarshan Sir ”

College Seal

Date of submission:
Project Guide Coordinator Principal External

ACKNOWLEDGEMENT

I would like to acknowledge the following as being idealistic channels and fresh dimensions in the
completion of this project.

I take this opportunity to thank the University of Mumbai for giving me chance to do this project.

I would like to thank my Principal, Dr Ravindran Karathadi for providing the necessary facilities required
for completion of this project.

I take this opportunity to thank our Coordinator for her moral support and guidance.

I would also like to express my sincere gratitude towards my project GUIDE “PROF. Priydarshan sir”
Whose guidance and care made the project successful

I would like to thank my College Library, for having provided various reference books and magazines
related to my project.
 INDEX

Sr. No TITLE OF CHAPTER PAGE NO.

1. CHAPTER – 1 6
INTRODUCTION
2. CHAPTER – 2 37
RESEARCH METHODOLGOY
3. CHAPTER – 3 41
REVIEW OF LITERATURE
4. CHAPTER – 4 45
DATA ANALYSIS
5. CHAPTER -5 55
CONCLUSION, SUGGESTIONS AND
RECOMMENDATIONS
6. BIBLOGRAPHY 61

7. APPENDIX 62
 CHAPTER – 1

INTRODUCTION

Micro, Small and Medium Enterprises (MSMEs) are an extremely vibrant and dynamic
sector of the Indian economy with over 6 million entities employing more than 11
millionpeople (right next to agriculture) and accounting for 28% of GDP and 40% of them
haveexports. Like other sectors, MSMEs have been impacted during COVD 19 in terms of
productivity. Accordingly, the efficiency and productivity of MSMEs is of further
importance to achieve the overall goals of economic development and a V-shaped recovery
of the Indian economy. The sector is quite diversified, including activities in agro-based
industries and housing surplus labor from structural change, as well as rural hinterland
service centers. In addition, MSMEs also work with domestic and externalcompanies to
develop manufacturing and multi-track supply chains. MSMEs extend theirdomain across
economic sectors, producing a diverse range of products and services tomeet the demands
of domestic and global markets. A number of statutory and non-governmental bodies work
under the aegis of the Ministry of MSME

Problems of GST:
Even after four years of GST implementation, taxpayers still face challenges in
navigatingthe ever-changing nuances of the GST law. The big challenge at GST could be
the integration of the small and medium-sized companies. Most small and
medium-sizedbusinesses may not have the technical know-how to adapt to this massive
shift. Duringthe introduction of the GST in July 2017, certain petroleum products and
electricity were kept outside of the GST for later inclusion in the GST regime. However,
even after 4 yearsthere is still no clarity about their inclusion in the GST system. Taxpayers
also strugglewith frequent changes to the ITC regulations. Ant trading regulations were
put in place toensure that the benefits derived from the introduction of GST are passed on
to end users.However, no guidelines for evaluating profiteering have been issued, leading to
differing.

Commerce expects the government to issue notices/circulations reasonably well in advance

and not at the last minute to allow taxpayers to plan their activities smoothly.The
ambiguity surrounding appropriate GST rates/classification of specific goods and services
(e.g. applicable rate for purified/treated water, exploration-related services, automotive
components, etc.) is another challenge. The GST was originally developed to simplify the
whole tax structure and therefore a single tax rate was proposed. This is the experience of
other countries that have implemented GST around the world. The unwritten principle in
GST is that you reduce the plates, which is why most countries have kept only one plate
from GST. But in the Indian context there is 0% slab, 5% slab, 12% slab, 18% slab and
28% slab. In addition, a new plate of 3% has been introduced specifically for gold. Under
the GST, an assessed files 37 returns per year (3 returns per month and 1 return per year).
This is in contrast to the 13 Returns Chapter I: Introduction Page | 23 submitted by an
examinee in he pre-GST era. Despite several challenges ahead of the GST, there are also
manyperspectives, which are discussed below.

Prospects of GST:
Prior to the introduction of GST on the production, supply and sale of goods and services,
separate taxes were levied at different rates by the Centre, States and Union Territories.
Centers levy an excise tax on the manufacture or production of goods, a service tax on the
supply of goods, and states levy an input tax on the importation of goods into the states

2897 | Viswanatha S R Impact Of Gst On Small And Medium Enterprises-A Study

for sale, and sales taxes on the sale of the same goods. The GST brought uniformity to the
tax system across the country. It eliminated the tax cascading effect that existed in the
pre-GST era due to multiple types of taxes. GST requires keeping a tax invoice and filing
tax returns through a computerized and online method. This prevents tax evasion, which
ultimately leads to an increase in tax revenue despite the low tax rate. A variety of central
and state taxes resulted in a complex indirect tax structure in the country, which made
calculating taxes difficult by requiring different experts with knowledge of different
lawsBut the GST resulted in high and hidden compliance costs for trade and industry.
Within the framework of the GST, every entrepreneur, whether goods manufacturer,
wholesaler or retailer, receives an invoice from the goods supplier to claim the input tax
credit. Therefore, goods suppliers can be easily identified and there will be less chance of
wrong goods being delivered. In order to attract industries in the states, the state
governments offered various types of rebates and incentives, resulting in lost revenue for
the state governments. Under GST, tax rates and exempt goods will be consistent. The
adverse trade effects due to different Value Added Tax (VAT) rates across states have been
eliminated as the GST rate will be consistent across states. The abolition of CST and Entry
Tax, check posts at the state border are no longer required, which has reduced the time for
goods transportation. The abolition of checkpoints at state borders has facilitated
interstate trade. GST is a tax on the supply of goods or services. Regardless of whether a
process is manufacturing or not for collecting excise duty, whether a transaction is for sale
of goods or not for collecting VAT, whether a transaction is for sale of goods or the
provision of services, these disputes will not arise upon the collection of GST. Exports are
zero rated in GST. The exporting industry would be able to have internationally
competitive prices as there is no cascading effect under the GST as a pre tax credit is
available for all taxes paid. Before that, type Chapter I: Introduction Page | A 24 tax credit
was not available for some taxes such as CST, Entry Tax, Excise Tax when calculating
VAT. Some measures were also suggested to deal with the current challenges of the GST.

* IMPACT OF GST*

1. Basic Threshold Limit for goods and services helping MSMEs. With GST in place, the
Micro Small and Medium Enterprises (MSMEs) got lot of benefits in terms of compliance
reliefs in the form of “threshold exemptions”, “Composition levy schemes”, “Quarterly
filing of the GST returns” to mention a few. In a major relief to MSMEs, the GST Council
doubled the tax exemption limit to Rs. 40 lakh in annual revenue. Similarly, the turnover
limit for businesses availing of the GST composition scheme, which allows them to pay tax
on goods and services at a flat rate, was raised to Rs.1.5 crore. The move aims to allay the
concerns of small traders. For north eastern and hilly states, the GST exemption limit has
been doubled to Rs.20 lakh. However, even though the current threshold limit has been
increased as above, some of the MSMEs may still want to be part of the GST chain, while
some may actually opt for composition scheme. The move to raise the threshold for GST
registration is significant, as it would help the MSMEs who had been badly hit by various
problems like demonetization, and business disruption in the early days of GST
implementation and creditsqueezes etc.

Bringing about major changes in the composition scheme, the turnover limit for goods was
raised to Rs. 1.5 crore from Rs. 1 crore which will also benefit the Service providers with a
turnover limit of up to Rs. 50 lakh to avail of the composition scheme as well at a rate of
6%. The composition scheme allows MSMEs to do away with tedious tax filing formalities
and pay GST at a flat rate. Businesses registered under the composition scheme are
required to pay GST at 1% to 6% depending on the type of business activity conducted by
the registered person/business entity.

2. High Compliance burden on the MSMEs.

After the initial bumpy ride, MSMEs, who had faced problems with GST compliance and
cash flows, are gradually settling down and adapting to the new indirect tax regime. A few
MSMEs have confirmed that the procedures of GST are getting easier day by day. The
uncertainty over input tax credit had been a dampener for quite some time for MSMEs as
it impacted their cash flow, but the proposed simplified return filing system is expected to
make the input tax credit flow smoother. Initially, MSMEs faced problems with GST
compliance and had to make certain modifications in their systems. Further, a number of
small taxpayers have opted for composition registration wherein they have to pay tax at a
specified percentage of their turnover.their monthly transactions with a view to ensure that
no activity has escaped the ambit of compliance. Similarly, the lack of a timely disposal of
refunds had impacted the cash flow for exporters of both goods and service. MSME
segment exporters had been affected due to the blockage of working capital. "However, the
new fully electronic refund process system announced under Circular No. 125/44/2019 –
GST, has ensured that the input tax credit is made available to the buyer on accepting the
invoices uploaded by the supplier. This introduction of electronic refund process should
immensely benefit the MSMEs. Further, since GST demands high automation of business
processes, the MSMEs had to spend enormous amount of time, money and energy on
development and maintenance of IT infrastructure. The introduction of a single quarterly
return for MSME sector has reduced the compliance burden and the MSMEs can now
focus on business development and growth instead of compliance aspects.

3. Adverse impact of Taxation under reverse charge for un-registered taxable

personsUnlike forward charge where the supplier of goods or services pays the tax on
supply, in case of Reverse Charge, the receiver becomes liable to pay the tax, i.e., the
chargeability gets reversed. This means that the GST will have to be paid directly by the
receiver to the Government instead of the supplier. The registered dealer who has to pay
GST under reverse charge has to do self-invoicing for the purchases made. For Interstate
purchases the buyer has to pay IGST and for Intra-state purchases CGST and SGST has to
be paid under RCM by the purchaser. Also, under Section 24 of CGST Act – Compulsory
registration in certain cases - all taxpayers required to pay tax under reverse charge have
to register under GST irrespective of the threshold limit applicable to them.

Thus, if any goods or services are supplied by a person who is unregistered andsupplied to
a registered person, then GST needs to be paid by the registered person under reverse
charge as a recipient. Further, if any MSME who does not take registration under GST and
claims the basic exemption threshold, then the person receiving goods or services from such
MSMEs need to pay GST under reverse charge mechanism. The above provision of RCM
has a very high negative impact, since businesses would definitely not prefer to deal with
any unregistered persons and to take the additional burden of compliance under reverse
charge mechanism. Therefore, this provision directly impacts the business of MSME Sector
negatively and virtually forces them to either register or shut the businesses which anyhow
is not the intention of the law makers.

4. Taxation on stock Transfers and deemed supplies between distinct persons: -

Valuation, which is the substance for levy, collection and administration of taxes, always
impacted indirect tax laws over the past years and GST is no exception to it. It is quite
common for an MSME having PAN India transactions to transfer its stock to its other
units, depos, warehouses to cater to timely delivery orders from different Geographical
Locations. Under the previous tax regime inter- state or intra-state stock transfers were

subjected to levy of Excise Duty on removal of Goods. Under the GST law tax collected
only on supply of Goods with or without consideration being paid or agreed to be paid. Per
clause 3 read with schedule I of GST law, a supply of goods by a taxable person to another
taxable person or non-taxable person during furtherance of business without consideration
is also included within the ambit of ‘supply’. Further, the subject matter of concern would
be the valuation of the stocks being transferred and the availability of Input Tax Credit.
With the shift of taxable event from sales to supply, stock transfers under GST would be
taxed and this scenario would certainly impact key MSMEs to the extent of savings in
procurement contracts, impact on free supplies, discount schemes, impact on product
pricing, and the overall financial impact of GST. Unlike earlier indirect tax regime, under
GST regime, stock transfer of goods/services between distinct persons is made liable to tax.
This step shall lead to blockage of working capital apart from high compliance burden. It
shall also defeat the idea of GST i.e. to have a free flow of goods anywhere and to create a
commonnational market. MSME’s do not have adequate capacities, technology, manpower
and with this complex requirement of the law. However, since GST is a destination-based
consumption tax, it is suggested todefer the taxation on stock transfers at least to the point
when such goods are actually sold, or provide for refund of the excess unutilized credit of
stock transfer in line with exports to help MSMEs.

5. Return of Goods sent on sale on approval basis and time limit thereof.

Sale on Approval is a business arrangement wherein an individual or company who is

interested in purchasing a specific item is allowed to use the item for a given length of time.
At the end of that time, if the individual is satisfied with the item, they agree to purchase it.
However, if the individual is unsatisfied for any reason, they are allowed to return the item
and are not committed to purchasing it. Unlike “consignment sales”, “sales on approval”
basis is not deemed as supplies under GST. Hence, the principal can send the goods to the
agent by issuing a delivery challan instead of a tax invoice, and without charging GST on
the same. Once the goods are sold by the agent to the end customer, it implies that the agent
has accepted the goods received on approval. Once this sale has been ratified by the agent,
the principal can then issue the tax invoice, and charge GST. The agent, at his end, can
collect the purchase invoice, and avail the input tax credit on the GST paid while filing his
returns and paying the output GST liability to the government.

A tax invoice should be issued for Sale on Approval before or at the time of supply OR6
months from the date of removal of goods from factory/godown. If the goods are not
approved within 6 months or if the agent has not ratified any sales within 6 months, it will
be deemed that sales of the said goods has taken place and a tax invoice will need to be
raised by the principal. If the Goods are returned within 6 months, for those goods, which
have been sent on an approval basis but are returned or rejected within a maximum of
period of six months, no tax will be payable, subject to an extension of maximum of 2
months by the Commissioner on merit. Under GST, the maximum time limit for the return

.of goods sent on sale or return basis is 6 months and if the same is not approved within the
said time limit then an invoice needs to be issued and the goods shall be deemed to have
been supplied. In case of various MSMEs, the norms are to send goods to Consignment
Sales Agents (CSA) and customers on a “sale or return” basis. However, putting a
time-limit on return of goods would have negative impact on such sectors. Therefore, to
help such MSMEs it is suggested to remove this provision and continue with the practice of
paying GST only when actual supply takes place.

6. Tax on Advances

Generally, GST is imposed on a supplier of goods and service at the time of receipt of
payment. However, in some cases, an advance payment is first made to the supplier by the
recipient of the goods or/and service or both. When a payment is made ahead of its actual
schedule such payment is also termed as advance payment. In addition to this, sometimes
the supplier of the goods and service demands an advance payment as a safeguard against
non-payment, or to cover its costs for supplying a product or rendering of a service. As
mentioned above advances received against supply of goods and/or services are taxable in
GST regime. Collection of GST on advances would be cumbersome and requires high
compliance and tracking. Moreover, it is possible that advance may have been received for
intra-state as well as inter-state supplies of goods and services and attracting multiple rates
and, therefore, the possibility of paying incorrect tax or determining incorrect place of
supply. Further, in certain business, advances would be received for multiple supplies and
in such circumstances individual identification of advances and matching of the same with
the corresponding supply for determining rate and place of supply shall be an additional
burden. Therefore, with the limited technological advent and resources in a MSME sector,
compliance with the provision of GST on advances would be difficult and lead to
unnecessary non-compliances. Therefore, it is suggested to allow the MSME sector to pay
GST only on invoice basis which would ease the compliance and cash flow burden of
MSMEs.

7. Non-availability of Composition Scheme.

Composition Scheme is a simple and easy scheme under GST for taxpayers. Small
taxpayers can get rid of tedious GST formalities and pay GST at a fixed rate of turnover.
This scheme can be opted by any taxpayer whose turnover is less than Rs. 1.5 crore as
notified by CBIC.A manufacturer of ice cream, pan masala, or tobacco, A person making
inter-state supplies, A casual taxable person or a non-resident taxable person, and
Businesses which supply goods through an e-commerce operator, cannot opt for
Composition Scheme. Nonavailability of composition scheme to those who are supplying
services or making any supply of goods which are not leviable to tax under the Act or if any

inter-state supply is made, seems to be harsh on such person. It is, therefore, suggested that
eligibility for composition scheme be based on the turnover during a particular financial
year and be made available uniformly to all suppliers whether supplying goods or services
or both anywhere in India. Alternatively, Sector specific composition schemes may be
designed to cater to need of different sectors. The embargo placed on effecting inter-State
supplies by the taxable person opting to pay tax under the composition scheme must be
done away with to benefit MSMEs.

8. Payment and filing of return for availing input tax credit: -

Once invoice is issued by a supplier under Section-31 with applicable tax reflected on it,
anonerous burden is being cast on recipient to prove tax has been deposited by the supplier.
The condition of tax to be deposited by the supplier to the credit of appropriate
Government in order to enable the purchaser to avail the input tax credit on such supply
made may cause undue hardship to the assesses. It is suggested that the pre-conditions
relating to payment of tax to the credit of Government and mandatory filing of return be
deleted and the same must be reconsidered and liberalized to enable the MSMEs to avail
input tax credit of tax paid by them as was prevailing in case of CENVAT credit rules
wherein credit can be taken immediately on receipt of goods/ receipt of
invoice.Alternatively, if a supplier has accepted the liability of such taxes and has also
disclosed the same in his statement of outward supply, the credit must be made eligible to
the recipient irrespective the payment by the supplier to the credit of government. Or else,
if the Government believes that certain taxable persons in the unorganized sector may not
deposit the collected tax to Government, the concept of reverse charge can be made
applicable to them instead of denying/ delaying the credit based on the non-compliance by
other party to the contract.

9. Power to Arrest &Prosecution: -

If the Commissioner of CGST/SGST believes a person has committed an offence u/s 132, he
can be arrested by any authorized CGST/SGST officer. The arrested person will be
informed about the grounds of his arrest. He will appear before the magistrate within 24
hours in case of cognizable offence. Offenses u/s 132 where arrest provisions become
applicable are as under: -

🕐 A taxable person supplies any goods/services without any invoice or issues a false
invoice

🕐 He issues any invoice or bill without supply of goods/services in violation of the

provisions of GST

🕐 He collects any GST but does not submit it to the government within 3 months
🕐 Even if he collects any GST in contravention of provisions, he still has to deposit it to
the
government within 3 months.

🕐 He has already been convicted of an earlier u/s 132 i.e., this is his 2nd offense.
A Commissioner of CGST or SGST can authorize an arrest of a person if he “has reason to
believe” that the person has committed any offence punishable under the GST law. The
person can be arrested even if such a person has not been issued a show cause notice
intimating the alleged violation and even if the investigations are yet to be concluded. It
also does not make a difference whether the alleged tax-liability is on account of deliberate
tax-evasion or is simply a differential tax liability in a genuine and bonafide dispute. Such
provisions relating to arrest, prosecution etc. are very stringent for lapses under GST
which puts more burden on MSMEs.

10. Determination of Place of Supply and the type of taxes.

Under GST 3 types of taxes can be charged in the invoice. SGST and CGST in case of an
intra-state transaction and IGST in case of an interstate transaction. But deciding whether
a particular transaction is interstate or intrastate is not an easy task. Hence Time, place,
and value of supply important under GST. Time of supply means the point in time when
goods/services are considered supplied’. When the seller knows the ‘time’, it helps him
identify due date for payment of taxes. Usually, in case of goods, the place of supply is
where the goods are delivered. So, the place of supply o goods is the place where the
ownership of goods changes. If there is no movement of goods, the place of supply is the
location of goods at the time of delivery to the recipient. Generally, the place of supply of
services is the location of the service recipient. In cases where the services are provided to
an unregistered dealer and their location is not available the location of service provider
will be the place of provision of service. Value of supply means the money that a seller
would want to collect the goods and services supplied. The amount collected by the seller
from the buyer is the value of supply. Since, GST is a destination-based consumption tax,
wherein taxes would accrue to the destination state, Government has provided provisions
for determining the place of supply in various situations. Hence under GST, small
businesses have to identify place of supply for each of their transactions and accordingly
GST needs to be paid to the credit of respective governments which shall be a cumbersome
task. Further, in case the place of supply is not correctly determined then tax needs to be

again paid to correct government and the taxes paid earlier needs to be claimed as refund.
It is suggested that law be amended so that in case tax is wrongly paid to incorrect
government, then instead of again paying the tax and applying for refund, such
government can itself do an inter-governmental settlement which shall ease the taxation
law.

1.2.9 DISADVANTAGES OF GST

These are the drawback of the good and services tax in India:
1. Transition proved complex: when the marketer shifted to the new tax rate it
producemany problem to the marketer which leads to relaxations by the GST council.
2. Change in software: marketer have to shift their accounting which is ESP software
toGST software. Purchasing of new software lead to increase in the cost.
3. Multiple tax rate: GST have 5 tax slab rate 0%, 5%, 12%, 18% and 28%.
4. Multiple state registrations: business now needs to register for GST in every state they
are doing or operating their business.
5. Professional needed: GST creates a need for a professional body in small business and
new formed business also need to Heir professional for GST works.
6. Increase in operational cost: by employing professional for GST complaint lead to
increase in the operation cost of the business.
7. Computerized GST: GST has to be filled online with the help of a computer but some
business does have computer on their small shops and many people do not know how
computer works which lead to many problem.
 CHAPTER-2
LITERATURE REVIEW

2.1 International review

2.1.1(Benedict, 2011) Author examines the aspects of the Australian GST law that deal
withfinancial services in order to determine if they have been properly construed in terms
of thelegislation's original meaning and how the issues raised can be addressed.
2.1.2(Emmanuel, 2013)Author explored the correlation between VAT, increased VAT costs,
and Nigerian economic development and tax revenue. The author has proposed two null
hypotheses for this analysis, both of which have been confirmed after the review has been
completed. Given the close relationship between the two, the author concludes that the
government and authorities should properly inform the consumers about the importance of
VAT so that they can more comfortably consider increases in VAT prices.
2.1.3(Fathi, 2012)Using a variety of experimental approaches, the authors investigated the
relationship between the rate of value added tax and public value added tax evasion. They
come to the conclusion that there is no correlation between the two since in many countries
with high VAT rates, enforcement is also high, and in countries with low VAT rates, evasion
is high.
2.1.4( Ahmad, 2010)in this article, the author discusses the Pakistani government's plans to
introduce a general sales tax. The author has addressed Pakistan's current indirect tax
regime, its past, and the changes suggested by the National Taxation Reforms Commission,
before highlighting the problems and advantages of the proposed reforms.
2.1.5(Genpact, 2011)In this article, Genpact summarizes how the results of a study they
performed for a manufacturing customer who was subject to European VAT saved money
as a result of some procedure improvements in the client's handling of VAT-related
compliances.
2.1.6(Gelardi, 2013)The author of the paper examined the potential effect on consumers of
the new National Consumption Tax to be implemented in the United States, as it would
result in higher prices for consumers. This new tax would be nationwide, in addition to the
various states' current sales taxes.
2.1.7 (Collins, 2014)in this article, the author examines and evaluates household payments
to direct tax and indirect tax revenues in Ireland. Furthermore, the importance of these
donations is examined in light of Ireland's latest indirect tax reforms.
2.1.8 (Zhou, 2013)in this article, the writers look at the Malaysian GST. The writers have
outlined the current problems in the Malaysian economy and compared them to the
planned GST. The effect of the goods and services tax on price levels, economic

development, revenue production, and other factors is also examined in the report. GST,
according to the report, will lower costs and raise GDP in general.
2.1.9 (Roshidi , 2016) Research aims to determine the extent of GST taxpayers'
understanding and interpretation in Malaysia. The participants in this sample were only
256 civil servants who worked as secondary school teachers in the kaula kangsar district of
Perak. Data is collected with the help of questionnaire. The results reveal that the GST has
a low to strong negative view among respondents.
2.1.10(Feria, 2009)in this article, the authors compare indirect taxation in Australia and the
EU, focusing on financial services, to see if the Australian good and services tax system is
better. Even, if the Australian system is superior, are there any elements that should be
introduced in the EU?

2.2 National reviews

2.2.1(sharma , 2018)in this study author talk about the GST and its advantages and
disadvantages. History of GST in India is also been explained by the researcher, study also
talks about the effect of GST in India in consumer and will the GST will help the economic
in the growth or not. GST is a big leap in indirect taxation system. Study is based on proper
fact and primary date is called with the help of questionnaire. The question under the
questionnaire is easy to understand and with the help of thus questionnaire we can make an
estimate whether the consumer are satisfy with the GST tax slab or does it require some
changes in it. 2.2.2(Garg, 2014)This study is based on the effects of GST and the historical
context of Indian taxes and tax system, as well as the obstacles, risks, and possibilities that
GST presents to our market economy. Based on the implications of GST with a brief
history of Indian taxes and tax structure, and addressed the potential obstacles, risks, and
possibilities that GST presents to improve our free market economy.
2.2.3(fintapp, 2017)this study is based on the consumer durable goods. This study talks
about the type of the consumer durable goods industries which are available in our
country. There are three types of consumer durable industries in India and these industries
are as follows, white, brown, consumer electronic. Revenue of consumer durables good
industry and how much growth in their revenue we can expect in the near future.
2.2.4(bhat, 2014)this article discusses about the e-governance of India's value added tax
system which is based in India and special preference is given to Goa and Kerala. Up until
2005, India had a very complex sales tax scheme. In 2005, a number of states, including
Goa and Kerala, switched from sales tax to the Value Added Tax. The availability of ITC
on imported products was the key benefit of VAT.
2.2.5(Guptha , 2014)According to her research, implementing GST in the Indian context
would result in commercial advantages that are not available under the VAT scheme, which
would essentially contribute to economic growth.
2.2.6(Adhana, 2015)this study is based on GST and its type. What is the aim of this taxation
system and what are the opportunities that a free market economy would provide?This
study helps us to understand the concept of GST and what is CGST, SGST, and IGST are.
In this study GST concepts is well explained with well-defined examples.
2.2.7(Rajamani, 2018)this study is aim to determine the impact of GST on the Indian
economy. In this study author would like to share his knowledge regarding the GST. Study
is based on the concepts of CGST, SGST and IGST. In this effect of GST on different
sectors is also shown and what are the positive of GST and its negative where explained in
the full detailed.
2.2.8(BHATIA, 2020)This study is based on the impact of GST on export goods and author
tell us how we can to export at 0% GST and are the ways by which we can claims this 0%
GST rate on export. This study is based on the detail analysis of the data related to the
export. In this study author talks about LUT methods by which we can claim 0% GST rate
on exports.
2.2.9(control, 2021)This article is based on the GST revenue collection of 31 march 2021 in
this year GST revenue collection breaks all past record by collecting 1, 23,902crore of
which CGST is Rs 22,973 crore, SGST is Rs 29,329 crore, IGST is Rs 62,842 crore
(including Rs 31,097 crore collected on import of goods) and cess is Rs 8,757 crore
(including Rs 935 crore collected on import of goods)," according to an official statement.
2.2.10(times, 2016)this article is based on the consumer durables goods tax slab rate should
be some down from 28% to 18%. Consumer have to bear the GST tax burden on consumer
durables goods because of high tax rate its lead to increase in the price of consumer
durable goods.
The MSME sector has believed to climb the growth stairs pretty fast in
comparison to other organized sectors as the low-cost structures sustained by
the tax-evading and implementing multiple venture registrations in order to
trespass tax limits prevailed earlier. All these points are major in accordance with
the sharp pricing of products and maintaining operating margins very closely
with the organised player of the market.

But now, the GST is set to scrutinise the sector by imposing threshold limits of 20
lakh for the manufacturing units which will ensure that the maximum number of
unorganised MSME players comes into the tax net. While the digital mode of the
transaction becomes compulsory which will further authenticate the invoice
under the GST which will make tax compliance tighten the knot.
The organised sector will have to tackle with increased tax burden but it can cope
by holding the pricing aspect can pass the burden to the customers and will be
able to improve the pricing strategy. In the case of MSME, it is supposed that a
simple tax framework will be applicable making an overall improvement in the
sector pushing it to reach wider. The sector will see promising growth in the
current fiscal according to the reports based on Crisil SME ratings.

The central government has done great work for the general public and state
government as it has continued various development work in the startup sector.
A lot has been done for the startup and emerging industries in the tax part.
Previously the government taxed the start-ups on as low as 5 lacs revenue but
now it has been increased to INR 20 lac with a composition scheme of 75 lakh
and above. The industry will be benefited from this move as India is a place of the
everyday new startup.

And according to the new GST scheme, The input tax credit can be availed which
is a lot more healthy for a business to grow from its own revenue. The factor
which was earlier paying a lot of VAT input in the service tax will be having a lot
more ease of doing business in multiple regions while extending the base of
business across the nation

From the previous demonetization move, the digital era tried to push the
mainstream line of transactions but now it is an integral part of the economy
creating more and more jobs and Ventures out of digital and online genre healthy
options.

Overall the GST is making a positive impact On the growing and budding sector
that is startups needed for innovations and development. This is a great time to
initiate new Ventures out of ideas to develop them into a fully grown
revenue-generating opportunities.

In the latest round of amendments, the MSMEs are now considered to be

evaluated on the basis of the annual turnover with certain changes to the
brackets. From now onwards, the micro-enterprises will be classified when it
comes with an annual turnover of INR 50 million. Also, small companies will be
considered when they are having an annual turnover of INR 50 million to INR 750
million. And for the medium enterprise classification, it would be considered
when the bracket of INR 750 million to INR 2.5 billion annual turnovers comes as
an annual turnover.

GST is the biggest tax reform in India after Independence. We have taken almost
60 years to pass a tax bill in which a uniform taxation system will be implied to all
over the nation.
We are people of a developing nation with lots of startups and small scaled
industries. In this scenario, there are a series of different types of taxes and rules.
These are hurdles in the way of becoming a developed nation. Currently, in
general, a Small scale manufacturing company pays Excise, Vat, and Service Tax
all three types of taxes and that’s why the rate of tax for all three combined goes
around 25% but after GST implementation it will come down to 18% which will
provide great relief to these companies.

In the 22nd GST Council meeting held on 06 October, it was decided for the SME
sector that the organizations with a turnover up to 1.5 crores will have to file GST
returns quarterly and not monthly basis. The relaxation is provided on the basis
of the turnover, as the tax obligation is far less according to the tax compliance in
the sector.

Small and Medium Enterprises (SMEs) have been considered as the main stream and
preliminary growth booster of the Indian Economy since Independence. It is further
evident from the fact that today we have more than 3 million SMEs in India contributing
almost 50% of the Industrial Output and 42% of India’s Total Net Export. For a
developing country like India and its demographic diversity, SMEs have emerged as the
leading employment-generating sector and has provided balanced development across
sectors. In this backdrop, we will examine what would be the impact of GST (Goods &
Service Tax) on Small & Medium Enterprises (SMEs).
After the passage of the Goods and Services Tax (GST) Bill, the Industry is hailing the
government for bringing up this reform which has been long pending because of political
deadlocks.

But before we analyze the impact of GST on Small & Medium Enterprises, we should
understand how GST is going to widen the taxpayer base. Earlier, any manufacturer
with a turnover of Rs 1.5 Cr. or less was not required to comply with the provisions of
Excise Law and were enjoying the benefit of SSI (Small Scale Industries). However,
with the merging of all State and Central Level Taxes into the periphery of GST, any
manufacturer with a turnover of Rs 20 Lacs (Generally for Normal States) or more will
have to comply with GST and its procedures.
.
All the compliance procedures under GST — Registration, Payments, Refunds,
Maintenance of Books of Accounts, Online Payment of Taxes and Returns will now be
carried out through online portals only and thus SMEs need not worry about interacting
with department officers for carrying out these compliances, which are considered as a
headache in the current tax regime. Thus, this may even reduce “Inspector Raj” which
was a deadly bottleneck till today for widening the Tax Base.

Example 1: A person is registered under Four States, with the following Aggregate
Turnover in the current year:

State Aggregate Turnover

Delhi 22,00,000

Maharashtra 20,00,000

Rajasthan 18,00,000

Haryana 16,00,000

Check the applicability of composition levy.

The combined Aggregate Turnover of all the above states is Rs. 76.00 Lacs. As
per law, the composition levy will be available till the person crosses Rs. 75.00
Lacs. After this, the composition levy will discontinue and normal provision will
be applied. The reason behind the availability of composition levy is that Rs.
76.00 Lacs is the turnover of the current year and not of the previous year. We
have assumed that the turnover of previous financial year is less than Rs. 75.00
Lacs.
Example 2: A person is registered under Four States, with the following
Aggregate Turnover in the current year:

State Aggregate Turnover

Delhi 32,00,000

Maharashtra 20,00,000

Rajasthan 18,00,000

Haryana 16,00,000

Check whether composition levy is applicable.

As per the definition of Aggregate Turnover, we have to check the turnover
cumulatively and not state-wise. The total Aggregate Turnover is Rs. 86 Lacs,
which is more than the Rs. 75.00 Lacs benchmark, and hence the liable person is
not eligible for the Composition Levy.
Composition levy is not available in certain cases
The composition levy is not available under certain cases where the taxable
person:

● Is engaged in the Supply of Services (Excluding Restaurant Service);

● Supplies Goods on which Tax is not Leviable under this Act (Non
Taxable / Exempted Goods);
● Makes any Inter-State Outward Supplies of Goods;
● Supplies Goods through an Electronic Commerce Operator and who is
required to Collect Tax at Source under Section 52;
● Is a manufacturer of such goods as may be notified on the
recommendation of the Council.
●
This article aims to educate the SMEs about future implications by GST, which
shall include Small General Stores at well. Hence, it should be understood clearly,
because even a small mistake can lead to severe penalties.
However, GST is the biggest reform since Independence. Hence, people should
be prepared nationwide to accept this change.

ST has been termed as biggest single tax reform post-independence. It will subsumed
various Central and States tax laws and is expected to give major boost to the Government
of India’s initiative of “Ease to do Business” and inclusion of all segments of society in the
development of the Country.
Tax payers are required to upload transactions details on the GSTN (GST Network) and
these transactions would be matched with second leg reported by the counter party to the
transaction. Processes will be online and report generation etc. would be done on the GSTN
system.
GST is expected to bring in many changes in the way businesses are done in India,
requiring unlearning old processes and learning / relearning new ways of doing business,
necessitating changes in procurement, sales, supply chain etc. Employees will be required
to be trained so that they have knowledge on new laws and can cop-up with requirements.
However in entire GST impact discussion, the most impacted function, Accounting &
Finance function, is seems to have been least discussed.
This post tries to bring focus on the impact of GST on the Accounting & Finance function.
GST will increase work load on the department and also increase function’s responsibility.

● Though reporting of carried forward input tax credit has to be done

before by 29 September, the available input tax credit needs to be
reconciled as on Day One as post effective date, the stock position
would start changing with new purchases and sales. After
reconciliation only, return can be filed.

● Opening stock has to be verified and reconciled so as to determine

write offs. GST input credit on write off is not allowed so it’s prudent to
write off excess input credit on the impaired / lost stock.

● Goods with job worker has to be reconcile and both have to declared /
reported stock. Any discrepancies have to be identified and sorted
out.
● Financial statements needs to be reconciled with ER-1, VAT returns,
ST-3 return. Any difference have to be appropriately accounted.

● Getting necessary forms like C,F,H,I etc. from the customers and
vendors and submitting the same to the tax department. Regular
follow-up would be required for these forms, explaining counter
parties about the importance of releasing the required forms. Unless
the forms are given in time, it may lead to penalty and rejection of
concession claims.

● A tax payer will have to file various returns in a month. Midsize tax
payer will have to file three returns per GST registration. So in case a
tax payer has GST registration in 10 states than monthly 30 returns
have to be filed. For more entities in a group, number of returns would
increase proportionately. Though reporting dates have been specified,
GST being online system, tax payers are encourage to report regularly
transaction details so that last moment rush is avoided. Accounts
function will be under continuous pressure they would be either filing
return or reconciling and following-up for reconciliation.

● In case of more than one place of business, accounts relating to each

place should be maintained at each place. This would require increase
in accounting staff to take care of local accounting and reporting.
Those tax payers who were having centralised registration so far, will
have to get state wise registration for the states where may supply
goods / services. This will increase number of returns to be filed as an
entity.

● The concept of TCS / TDS is also proposed to be introduced in GST

which could pose challenge to accounts team. Non awareness could
result in additional cost to entity in form of interest and penalties.

● Each tax payer would be assigned rating by the GST system on the
basis of performance of a tax payer as regard various compliances.
Basis rating, vendors and customers would evaluate the ease of doing
business of that tax payer before doing business with him as timely
● filing of returns, taxes would give them benefits like input tax credit. In
order to maintain rating, the accounting function will have to plan and
ensure compliances ongoing basis throughout year.

● Ascertain status of various tax litigation under earlier laws and need to
evaluate likely liability. Depending on the stages at which litigation is
going on and various factors like value involved, number of pending
assessments etc. dedicated staff who has knowledge and
understanding of old laws will have to be involved. So though other
function would move to GST, Accounts function would be dealing with
both new and old tax laws.

● Accounting system would undergo change with opening of several

new accounts like output CGST/SGST/IGST, input CGST/SGST/IGST ,
ITC CGST/SGST/IGST, interest, penalty, etc. necessitating change in
accounting process.

● Accounts team will have to get accustomed to new provision like

reverse charge mechanism, reconciling ITC, reversal of ITC due to
non-payment etc. This will require regular monitoring of GST ledgers
in the GSTN and constant follow-up with vendors and customers. A
tax payer can be denied input tax credit if the seller has not reported
the transaction. There will be shift in relationship from personal touch
to compliance based and dealing with counter parties would be a
challenge for the accounting function.

● Changes in formats and reports such as tax registers, tax invoices

etc.GST would bring paradigm shift in indirect tax laws. The accounts
team should be aware of changes and in addition, the changes
required in all relevant registers, invoices and forms should be
undertaken. The manual registers and reports to the extent possible
should be done away with as most of the information in GST would be
automated.

● Registration requirements
 All tax payers registered under any of the present indirect tax laws, except
centralised registration, would get automatic GST registration. In case of
service providers with multiple locations having centralized registration,
there is a need for obtaining registration for each of the states having
presence.
Those who have multiple registration, would need to evaluate whether
those registration are required post GST.

● Agreement modifications with vendors / customers

Post GST effective date, many of indirect taxes would discontinue. This
would require review of major agreements entered with vendors and
customers so that they are in compliance with GST. The major points to be
considered are:
a. All existing agreements where reference have been made for service tax,
VAT/CST or excise duty needs to be replaced by GST.
b. Purchase orders issued to vendors would require modifications on
introduction of GST. During transition time also, care should be taken to
ensure that the vendors are passing on all tax benefits with break up on the
invoices.
c. All new agreements proposed to be entered into may have to include a
specific reference that tax clause would be revisited / amended as proposed
in GST amendments.
An entity will have to evaluate increase in activity for the accounts team and
will have to plan accordingly. Due to shortage of staff, compliance should not
suffer which could have impact on the entity’s rating and input tax credit.
Separate team should be formed for reporting, reconciling and for day to day
accounting work. Coordination with other locations, vendors, customers
would be required and would require experience accounting staff.

Small and Medium Enterprises (SMEs) have been considered as the

primary growth driver of the Indian economy for decades. It is further

evident from the fact that today we have around 3 million SMEs in India

contributing almost 50% of the industrial output and 42% of India’s total

export. For a developing country like India and its demographic

diversity, SMEs have emerged as the leading employment-generating

sector and has provided balanced development across sectors.

Let’s examine what would be the impact of GST on Small & Medium

Enterprises. After the passage of the Goods and Services Tax (GST) Bill,

the Industry is hailing the government for bringing up this reform which

has been long pending because of political deadlocks. But before we

analyze the impact of GST on Small & Medium Enterprises, we should

understand how GST is going to widen the taxpayer base. Earlier, any

manufacturer with a turnover of Rs 1.5 crore or less was not required to

comply to the rules of excise duty.

However, with the merging of all State and Central level taxes into the

ambit of GST, any manufacturer with a turnover of Rs 20 lakh (others)

/10Lakh (Special category states) or more will have to comply with GST

and its procedures. All the compliance procedures under GST —

Registration, Payments, Refunds and Returns will now be carried out

through online portals only and thus SMEs need not worry about

interacting with department officers for carrying out these compliances,

which are considered as a headache in the current tax regime.

Below we have provided a high level impact analysis of GST on small

and medium businesses in India.

Complianc Positives Negatives

Procedure

Registratio Online registration will Not all the SMEs have

n ensure timely receipt technical expertise to deal

of certificate of with online systems, thus

registration and most of them will need

minimal bureaucracy intermediaries to obtain

interface registration for them. This will

add to their registration cost.

Payment Electronic compliance Since funds are required to be

will bring transparency maintained in the form of

and will also reduce electronic credit ledger with

the compliance cost. the tax department, it may

result in liquidity crunch.

Refund Electronic refund Refunds can be claimed only

procedures will fast after filing of relevant returns.

track the process and Also it depends on the

enhance liquidity for compliances done by the

SMEs supplier and his rating.

 Returns All returns are required Minimum of thirty-seven

to be filed returns are required to be

electronically and input filed by every registered

tax credit and tax taxpayer during a financial

liability adjustment will year. Thus SMEs will have to

happen automatically deploy additional resources

on the basis of these and eventual cost of

returns compliance will increase

No doubt that GST is aimed to increase the taxpayer base, majorly SMEs
into its scope and will put a burden of compliance and associated costs
to them. But in the long run, GST will turn these SMEs more competitive
with a level playing field between large enterprises and them.
Furthermore, these Indian SMEs would be able to compete with foreign
competition coming from cheap cost centers such as China, Philippines
and Bangladesh.
After Demonetization, GST has been one of the biggest transformations that India
has seen in years. Amidst the hustle bustle going around the nation, GST became
a game changer for the Indian Economy, certainly affecting the “Aam Aadmi” to
the Business Entrepreneurs as well. From boosting up the consumer
goods-industry (FMCG Industry) to bring forth varied benefits to the economy,
the new Goods and Services Tax (GST) regime can make the market go up within
the shortest time.

It is quite evident that GST has made a visible change in the Indian Economy and
FMCG, fourth largest sector in the economy, is amidst one of them to witness the
same. The fact is undeniable that FMCG is one of the fastest growing sectors of
the Indian Economy. VAT, Service Tax, Excise duty, Central Sales Tax etc have to
be paid by the FMCG Sector under the current GST Regime. The Consumer
Packed Goods or we can say the FMCG (Fast Moving Consumer Goods) current
tax rate is nearly 22-24%; though the expected rate is 18-20%, which would be
highly greeted by the major FMCG industry players. For CST, CVD, and SAD there
was no credit available under the current tax regime; contrary to that, GST would
include the input credit for all the GST payments made in the course of business.

The benefit under the GST Regime would be visible and considerable saving
amount of expenses on logistics can be seen in FMCG Industry. The total cost of
the distribution of the FMCG industry sums up to 2-7%, which might fall to 1.5%
after the complete implementation of GST. A huge impact and change will be seen
in terms of cost reduction owing to the payment of tax, smoother supply chain
management, removal of CST, claiming input credit, under the GST Scenario. The
result will lead to cheaper consumer goods.

Many of the companies, according to their convenience and to enjoy a lot of tax
benefits/holidays/exemptions, under the current tax regime set up their
warehouses in the states like Himachal Pradesh and Uttaranchal. The dilemma is
still there, to whether all the tax holidays, benefits and exemptions would be there
or not, once GST is implemented. Since the costing is one of the major parts of
any company, thus, major companies like ITC, Hindustan Unilever, Nestle, Dabur
& Cadbury are still anxious regarding the migration of Tax holidays/exemptions.

Inflation in the Effective Tax Rate:

Aerated beverages have been given the highest rate slab of 28% under GST, with
an additional tax of 12%. According to the varied Beverage companies, 40% is the
effective tax rate for the sweetened aerated water and flavored water, which is not
in line with the stated policy of maintaining uniformity with the existing weighted
average tax that is below 40%. This has been very disappointing for varied
companies like Coca-Cola India, Dabur India Ltd, Red Bull India Pvt. Ltd, Pepsi Co
India Holdings Pvt. Ltd, and Pearl Drinks Ltd, as stated by the Indian Beverages
Association (IBA).

Estimates by Euro ministers International, a market research firm, states that

Carbonated Beverages in Indian Market is projected to grow by 3.7% every year
between 2017 and 2021. A different study shows by research firm Nielsen, a
consumption of 5.9 billion litres of soft drinks was seen in the year 2015.

The products that are widely consumed inclusive of toothpaste, hair oil, soaps, all
have been enclosed in the 18% slab, which is lower than the 22-24% tax rate.
Keeping the Frozen Vegetables and Branded Cheese have been under the 5% rate
list that are largely neutral with the previous rates were around 3-4%. Cereals
have been exempted, so are likely to become more affordable. Being already in
the bracket of 4-6%, Coffee, Tea, and Sugar have not seen any impact on the
prices. Most of all items are in the 18% tax bracket or might be below that. The
minor category falls in the 28% tax slab

Positive Impact of GST on MSMEs

● Low Rates Taxes

With the application of GST, industries having a turnover between Rs.10
and 50 lakh have to pay levies at lower rates, thereby, getting an enormous
relief from tax burdens.
● Reduction in Logistics Cost and Time
GST enactment reduced time and money required for Interstate movement
as their duties got eliminated. Also, this diminishes costs of retaining large
stocks due to ease in free movement of goods.
● Creating a Uniform Platform
GST levies taxes on stock transmissions and neutralizes the impact of
contributed taxes through the input credit too, thus, removing all tax
 differentiation and bringing small and medium businesses to par with
large-scale industries.
● Increased Reach to Customers
Presently, the Central Sales Tax (CST) on sales between states restricts
small and medium businesses to reach their potential customers across
India, which surges the acquisition charge of products for the consumers. The
implementation of GST will prevent that.

Negative Impact of GST on MSMEs

● Burden of Lower Threshold

GST bill has improved the threshold limit from 10 lakh to 20 lakh generally
and from 4 lakh to 10 lakh for North-eastern states, due to which any
service provider or retailer is subject to the tax levy. Earlier, the central
expunge threshold was INR 1.5 crore. Now, as the threshold is low, most
MSMEs have to pay a lump sum of their investment towards tax in the near,
foreseeable future.
● Lack of Tax Differentiation for Luxury Items and Services
The GST implementation has the function of tax neutrality, which though
beneficial in other areas, does not differentiate between luxury and normal
items and services. Unlike earlier, when the state and central government
levied greater duties on luxury goods and services, the GST tax requires all
goods and services to have the same tax. This leads to an increase in the
financial gap between the rich and the poor and is not a model situation for
MSMEs to compete and flourish against large industries.
● Selective Tax Levying
GST tax is not applicable to alcoholic liquor for human consumption as
well as petroleum and oil based industries, which is a contradiction of the
policy of the 'unified market' philosophy of GST.
● Extra Operational Capital Requirement
Taxes on stock transmission primarily affect the functioning capital
necessities. This, in fact, varies with factors such as stock reversal time at
depository, credit sequence to the consumer, etc. A greater sum of Capital
Prerequisites increases the interest charge, which finally increases the rate
of Completed Merchandises.
 CHAPTER -III
RESEARCH METHODOLOGY

3.1 OBJECTIVE OF THE STUDY

🕐 To understand the relation between GST and price inflation of consumer durable goods
🕐 To understand GST more deeply.
🕐 To understand consumer durables goods more deeply.
🕐 To find out the advantages and disadvantages of GST.
3.2 RESEARCH HYPOTHESIS
H0:- There is no significant difference between the education qualification level and their
satisfaction towards the current GST slab rates of consumer durables goods. H1:- There is
significant difference between the education qualification level and their satisfaction
towards the current GST slab rates of consumer durables goods.

3.3 SCOPE OF THE STUDY

This study is done for finding out the effect of GST on consumer durables goods and on
consumer views on GST. This study is based on the respondent/consumer selected form the
Bhopal to find out their consumption pattern. Respondent are selected form the mixed
group which is wider difference in understanding. Scope of the research is small because of
its limited area.
3.4 RESERCH DESIGN

🕐 Geographical area: this research is based on the respondent which is located in Bhopal.
🕐 Duration of the study: 1 month
🕐 Simple size: 100respondentsare selected for filling questionnaire.
🕐 Sampling technique: judgment sampling is taken for the study (Those respondents are
select which have knowledge regarding GST)

🕐 Data collection instrument: Information gathering is very important for any researcher.
Information is divided into two parts primary data and secondary data. Primary data is a
type of data in which data is collected by the researcher and it’s done by taking
questionnaire. Secondary data is a type of data which is already been collected by the other
but its utilized by the researcher.
In this study researcher have taking primary data for analysis purposes. In primary data
questionnaire is created with the help of Google form and this form is based on the topic
impact of GST on consumer durable goods. In this questionnaire respondent are selected
form Bhopal. Secondary data ,Journal,Research paper, Internet, Books.

🕐 Data collection producer:

Primary data is collected with the help of a questionnaire which was in the form of Google
form. This Google form is distributed among the respondent of Bhopal with the help of
social media apps like Facebook, twitter, WhatsApp, Instagram, Discord etc. this a type of
a questionnaire which should be fill out by yourself and this questionnaire is divided into
two section and these section are section A and section B. In section- A question are consist
of personal information and these information are Age, Gender, Qualification, Marital
Status, and Occupation. In Section-B question are based on question which are related to
the research and fulfill the research objective and its 10 question.

🕐 3.5. LIMITATION OF THE RESERCH:

1. This study is conducted in a limited area which is Bhopal so it’s not applicable to all the
cities
2. This research is conducted at a time when our country is going through a pandemic
because of which it create price hike in the market which gives us misleading data
regarding GST rate on consumer durables goods.
3. Data given by the primary data (questionnaire) may not be correct because its fill by my
friends, family and the data collected from this questionnaire may be misleading to some
reader
 CHAPTER-IV
DATA REPRESENTATION &ANALYSIS

DATA ANSLYSIS
Q.1 Q1) Gender
A) Female B) Male c) prefer not say
. MALE 50%
. FEMALE 40%
. prefer not say 10%

Q2) Martial status

A) Married B) Unmarried
. Married 60%
. Unmarried 40%

Q3) Age Group

A) 18-25 B) 25-35 C) 35-45 D) Above 45
. 18-25 50%
. 25-35 30%
. 35-45 10%
. Above 45 10%
Q4) Occupation
A) Businessmen B) Student C) Professional D) Any other
. Businessmen 40%
. Student 20%
. Professional 20%
. Any other 20%

Q5) Qualification
. Graduate B) Post Graduate C) Any other
qualification(under-graduate)
. Graduate 50%
. Post graduate 30%
. Any other qualification(under-graduate) 20%

Q6) Is GST good for the economy?

A) Yes B) NO C) Maybe
. Yes 60%
. NO 30%
. Maybe 10

Q7) Does GST increase the various legal formalities?

A) Strongly agree B) Agree C) Neutral D) Disagree E) Strongly disagree
. Strongly agree 40%
. Agree 20%
. Neutral 20%
. Disagree 10%
. Strongly disagree 10%

Q8) Does GST increase the tax burden on the common people
A) Strongly agree B) Agree C) Neutral D) Disagree E) Strongly disagree
. Strongly agree 40%
. Agree 20%
. Neutral 20%
. Disagree 10%
. Strongly disagree 10%

Q9) Does GST increase the tax burden on the businessmen

A) Strongly agree B) Agree C) Neutral D) Disagree E) Strongly disagree
. Strongly agree 50%
. Agree 20%
. Neutral 10%
. Disagree 10%
. Strongly disagree 10%
Q10) Is GST hard to understand?
A) Strongly agree B) Agree C) Neutral D) Disagree E) Strongly disagree
. Strongly agree 20%
. Agree 20%
. Neutral 10%
. Disagree 30%
. Strongly disagree 20%

Q11) Does GST is beneficial in long run

A) Strongly agree B) Agree C) Neutral D) Disagree E) Strongly disagree
. Strongly agree 60%
. Agree 10%
. Neutral 10%
. Disagree 10%
. Strongly disagree 10%

Q12) GST is a good method to replace the sales and service tax
A) Strongly agree B) Agree C) Neutral D) Disagree E) Strongly disagree
. Strongly agree 60%
. Agree 10%
. Neutral 10%
. Disagree 10%
. Strongly disagree 10%
Q13) Will GST lead to increase in the friendly competition of the firm. Which
leads toinnovation for new consumer durable product?
A) Strongly agree B) Agree C) Neutral D) Disagree E) Strongly disagree
. Strongly agree 60%
. Agree 10%
. Neutral 10%
. Disagree 10%
. Strongly disagree 10%

Q14) GST is been imposed on consumer durables good which lead to create
price inflation for consumer durables goods.
A) Strongly agree B) Agree C) Neutral D) Disagree E) Strongly disagree
. Strongly agree 60%
. Agree 10%
. Neutral 10%
. Disagree 10%
. Strongly disagree 10%

Q15) Are you satisfied with current GST slab rates which is imposed on
MSME sector.
A) Strongly agree B) Agree C) Neutral D) Disagree E) Strongly disagree
. Strongly agree 60%
. Agree 10%
. Neutral 10%
. Disagree 10%
. Strongly disagree 10%
 CHAPTER V
RESULT & DISCUSSION

5.1Finding of the study

🕐 Mainly most of the respondents are Male.

🕐 Most of the respondents are married.
🕐 38% respondents belong to the age group of 18-25.
🕐 29% respondents are businessmen.
🕐 45% respondents are graduated.
🕐 Perception of the respondent towards the GST is positive and they think
that GST is
good for the economy.

🕐 Perception of the 69% respondent towards the GST is that the GST wills
increases the
tax burden on the common people.

🕐 68% respondent is responded that GST increased the various legal

formalities.

🕐 36% respondent agrees that GST will increase the tax burden on the
business.
🕐 Perception of the respondent towards the impact of GST in long run will
be beneficial for the economy.

🕐 40% respondent agrees that the GST will lead to increase in the
competition for manufactures of consumer durables goods.

🕐 70% respondent are responded that GST is been imposed on consumer

durables good which lead to create price inflation for consumer durables
goods.

🕐 Most of the respondents are responded that GST is hard to understand.

🕐 Consumers are highly satisfied with the current GST slab rates which are
imposed on the consumer durables goods.

🕐 Respondent agree that the GST tax will attract more MNC into the market
and this will leads to create more competition into the market for consumer
durables goods and more competition will leads to reduction in the prices of
the consumer durables goods.

5.2Suggestions

🕐 The respondent/consumer suggested that there should be simple,

transparent and easy to understand provision in GST.

🕐 Government should try to reduce the slab rate of MSME sector if possible,
because some people are very poor and for them to purchase a consumer
durable goods are like a dream which they can only fulfill once in a lifetime.

🕐 For some middle class businessmen which are computer illiterate

government must provide training program in which their doubts related to
GST can completely be cleared.
🕐 The government must make sure that the GST revenue is properly
managed.

🕐 Government must provide incentive/subsides for small scale domestic

manufacture of consumer .

🕐 Government must reduce the GST tax rate on energy-efficient

products/eco-friendly like 4 star, 5 star, and inverter air conditioners and
refrigerators and this will leads to create more demand for these consumer
durables goods.

5.3 Conclusion

This is based on the overall highlight of good and service tax and its impact on
consumer durable goods in Bhopal. Government must make different
information platform in which information regarding GST can be collected
easily and this information must been in a format in which it can be easily
understand by the consumer. Goods and services understanding among the
consumer must be good and this good understanding will help in creating a
positive perception towards GST. Bhopal custom department must spread
awareness regarding impact of GST on consumer durables goods. Bhopal
custom department must aware people about the positive of GST and this will
leads to create goods perception of consumer towards GST
Although the GST implementation aims to upsurge the taxpayer base, largely
SMEs into its opportunity, it presents a problem of compliance and related
charges for them.
Nevertheless, GST will make the MSMEs more competitive in the long run and will
make the playing arena level between big enterprises and them. Additionally, the
Indian MSMEs would be able to compete with the international market goods and
competition coming from cheap price epicentres such as China, Philippines, and
Bangladesh and actually thrive in the world market scenario.
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 ANNEXURE

QUESTIONNAIRE SURVEY
Question:
Q1) Gender
A) Female B) Male
c) prefer not say

Q2) Martial status

A) Married B) Unmarried

Q3) Age Group

A) 18-25
B) 25-35
C) 35-45
D) Above 45
Q4) Occupation
A) Businessmen
B) Student
C) Professional
D) Any other

Q5) Qualification
A) Graduate
B) Post graduate
C) Any other qualification(under-graduate)

Q6) Is GST good for the economy?

A) Yes
B) NO
C) Maybe

Q7) Does GST increase the various legal formalities?

A) Strongly agree
B) Agree
C) Neutral
D) Disagree
E) Strongly disagree
Q8) Does GST increase the tax burden on the common people
A) Strongly agree
B) Agree
C) Neutral
D) Disagree
E) Strongly disagree

Q9) Does GST increase the tax burden on the businessmen

A) Strongly agree
B) Agree
C) Neutral
D) Disagree
E) Strongly disagree

Q10) Is GST hard to understand?

A) Strongly agree
B) Agree
C) Neutral
D) Disagree
E) Strongly disagree
Q11) Does GST is beneficial in long run
A) Strongly agree
B) Agree
C) Neutral
D) Disagree
E) Strongly disagree

Q12) GST is a good method to replace the sales and service tax
A) Strongly agree
B) Agree
C) Neutral
D) Disagree
E) Strongly disagree

Q13) Will GST lead to increase in the friendly competition of the firm. Which
leads toinnovation for new consumer durable product?
A) Strongly agree
B) Agree
C) Neutral
D) Disagree
E) Strongly disagree

Q14) GST is been imposed on consumer durables good which lead to create
price
inflation for consumer durables goods.
A) Strongly agree
B) Agree
C) Neutral
D) Disagree
E) Strongly disagree

Q15) Are you satisfied with current GST slab rates which is imposed on
consumer durable goods?
A) Strongly agree
B) Agree
C) Neutral
D) Disagree
E) Strongly disagree