© 2024 JETIR May 2024, Volume 11, Issue 5 [Link].

org (ISSN-2349-5162)

TOPIC – IMPACT OF GST ON DAYTO DAY

LIFE

Sanjana M H

VI semester [Link],

PES Institute of Technology– Bangalore South Campus,

India,

Abstract:
This paper presents about the Goods and Services Tax (GST) implementation in India in July 2017 marked
a significant shift in the country's taxation structure, aiming to simplify the tax regime, reduce costs, and
promote economic growth. This paper explores the multifaceted impact of GST on day-to-day life, analysing
its implications for consumers, businesses, and the overall economy. It examines how GST simplifies the tax
structure, reduces the overall tax burden on goods and services, promotes transparency and compliance,
integrates the national market, and fosters the growth of the digital economy. The study also discusses the
challenges and opportunities posed by GST implementation, highlighting the complexities involved in such
a vast tax reform.
Key points: GST, Tax, Transparency, simplify
CHAPTER- 1: INTRODUCTION
1. Background of the topic
The Goods and Services Tax (GST) introduced in various countries, notably India in July 2017, marked a
significant overhaul of the tax structure, aiming to unify the country's complex taxation system into a single,
comprehensive regime. This transition was designed to eliminate the cascading effect of taxes, where tax on
tax was previously charged across different stages of the supply chain, thereby making goods and services
more expensive for the final consumer. By subsuming multiple indirect taxes levied by the central and state
governments into a single tax, GST proposed to create a more transparent, cohesive, and efficient taxation
environment. GST, a consumption-based tax, replaced a multitude of previous taxes with the aim of
simplifying the tax structure and reducing tax cascading.

Its implementation has led to noticeable changes in the pricing of goods and services, as GST is included in
their prices. While some items may become cheaper due to the removal of cascading taxes, others might
become pricier due to alterations in tax [Link], the provision of Input Tax Credit (ITC) allows
businesses to offset the GST they've paid on purchases against the GST they collect on sales, potentially
reducing overall tax liabilities and affecting consumer prices.
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The impact of GST on day-to-day life has been multifaceted, affecting consumers, businesses, and the overall
economy. For consumers, it promised a reduction in the overall tax burden on goods and services, leading to
potential decreases in prices, although the actual impact varied across different sectors. Businesses
experienced a significant transformation in their operations, compliance procedures, and tax calculations,
moving towards a more digitized and uniform process across states. This was expected to foster a better
business environment, encouraging investment and growth. However, the transition also posed challenges,
including adapting to new compliance requirements and understanding the varied tax slabs applicable to
different goods and services.

In essence, GST aimed to make the economy more productive by reducing trade barriers within the country
and making Indian products more competitive in international markets. Yet, its immediate impact on the day-
to-day life of ordinary citizens and businesses has been a blend of advantages and teething problems,
reflecting the complexities of implementing such a vast tax reform.

CHAPTER- 2: LITERATURE REVIEW

REVIEW OF LITERATURE:
1)GST IN INDIA
India's Goods and Services Tax (GST), which went into effect on July 1, 2017, is a major reform of the tax
system with the goal of consolidating the nation's intricate taxing framework into a single, all-encompassing
tax regime. By removing the cascading effect of taxes, this revolutionary policy aims to improve economic
efficiency and aid in the development of a single national market. The literature on GST in India delves
deeply into its effects on different industries and evaluates the advantages and difficulties of implementing
it. Studies cover challenges such transitional complexity and compliance requirements for small firms, while
also highlighting gains in the ease of doing business, improved tax base, and potential for GDP growth.
2) IMPACT OF GOODS AND SERVICES TAX ON SMALL SCALE INDUSTRIES IN INDIA:
This is India's largest tax reform to date. The main goals of the GST's adoption in India are to do away with
several indirect taxes, lessen the tax burden, and create a cascading effect—all of which are only achievable
through the GST. The impact of GST on Indian SSIs is highlighted in the study. Approximately 40% of India's
industrial production, 42% of exports, and 65% of job prospects are attributed to SSIs, making them a
significant economic force. This essay outlines the advantages of GST for SSIs as well as the challenges SSIs
have encountered since the law's adoption.
3) A Comprehensive Analysis of Goods and Services Tax (GST) in India:
The introduction of GST was initially scheduled for April 2010, however it was delayed because of political
unrest and competing stakeholder interests. The main goal of the GST's development was to unify India's
indirect taxation landscape by incorporating all existing indirect taxes, including service taxes, VAT/Sales
taxes, and Central Excise taxes. The country's GDP rate rises from 1% to 2% under the GST-based taxation
system, which also decreases tax evasion and corruption.
4) A Study of Goods & Services Tax (GST) & Its Impact on India:
This study explored On July 1st, 2017, the Indian government enacted the Goods and Services Tax (GST).
This is the largest indirect tax reform in Indian history, with different Central and State taxes being merged
under the GST as a result. VAT, Sales Tax, Purchase Tax, Luxury Tax, Entry Tax, Countervailing Duty,
Special Additional Duty, Central Excise Duty, etc. This article examines the structure of the Goods and
Services Tax (GST), its effects on the Indian economy, and the practical challenges that industry and
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consumers confront in adopting the GST. This essay is based on a thorough analysis of the GST Act, a number
of newspaper articles, the objective advice of tax professionals, and stakeholder experience.
5) Goods and Services Tax (GST) Implementation in India:
Using a case-based qualitative investigation, the study sought to determine the degree to which the
implementation of the GST has affected the economy in general and citizens and/or consumers in particular.
For the case analysis, the current study used the situation-actor-process; learning-action-performance analytic
framework. The data shows that India's tax base has increased significantly in comparison to revenue
collection. However, various actions are needed to address the low tax to GDP ratio, the skewed base of GST
payers, the unfavorable opinion of GST among stakeholders (as seen by sentiment analysis on Twitter), and
the evil of tax evasion.
6) Assessing the Impact of GST on Cost- of-Living of Households:
It is anticipated to have a multifaceted effect on the economy as a whole, affecting businesses, households,
and government organizations. It will also be felt by different sectors in a dynamic and non-linear way across
varying time periods. This column focuses on the elements that must be taken into account when determining
how the GST will affect households' costs of living. Estimating the difference between a household's pre-
GST and post-GST spending on a certain bundle of products and services allows one to evaluate the impact
of the cost of living. Household bundles of goods and services vary depending on factors including age
composition, income level, and tastes, therefore different families may experience different effects from the
GST. Therefore, even if there is pressure to provide one conclusive response, it is not beneficial to focus on
the effect of GST on households.
7) IMPACT OF GST ON HOTEL INDUSTRY:
An indirect tax imposed on the provision of products and services is known as the goods and service tax, or
GST. Numerous earlier indirect tax regulations in India have been superseded by this one. For the whole
nation, there is only one indirect tax: GST. Numerous research have been conducted regarding GST and its
effects on different industries. Primary and secondary data form the basis of the current investigation.
Secondary data was acquired from the hotel Arya Niwas, which was awarded a three-star rating by the
Rajasthani government, while primary data was directly gathered from the hotel and customer bills. The
study demonstrates the analytical and descriptive vision. The report illustrates how the GST has affected
stakeholders in the hotel business.
8) Maintenance of Records And Accounts Under GST Act 2017:
Thorough record-keeping under the Goods and Services Tax (GST) system is essential for operational
efficiency and compliance in the Indian corporate environment, not only because it's required by law. Precise
and comprehensive accounting records enable easy filing of returns, clear audit trails, and the best possible
use of the Input Tax Credit (ITC), which reduces tax obligations. Strategic planning is guided by this
transparency, which also helps to ensure long-term sustainability by empowering educated business decisions
and building confidence with stakeholders. It is not only about following the law; investing in careful record-
keeping, maybe enhanced by GST-compliant software, is about laying the groundwork for long-term
economic success in the GST age.
9) AWARENESS AND IMPACT OF GST AMONG SMALL BUSINESS OWNERS:
Finding out how informed small business owners are of the GST and evaluating the real effects they are
dealing with are the main goals of the research. Although it is recognized that there will be an impact on
either selling or manufacturing, research is done to determine the precise impact and degree of satisfaction.
This is a survey-based study that gathered information from fifty Mandsaur City-based businessmen. The
analysis's findings showed that, although businessmen believe the GST is a fair tax system and are aware of
its implementation, there has to be greater transparency and procedural simplification because they must rely
on CAs for online submissions.

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10) A Study of Impact of GST on Real Estate Sector in India:
The implementation of GST is both relaxing and disruptive for the real estate sector. In contrast to fast-
moving consumer goods, apartments lack a "MRP" and a "Best before" date. The administration believes
that prices will go down if there is a standard GST. However, the Union Government must address the issues
the real estate sector has with regard to indirect taxes. The GST Council has altered the GST in relation to
real estate based on recommendations from developers, tax officials, and consumers.
11) Time Limit for Filling GST Appeal extended for order passed till 31.03.2023:
An appeal against judgments or orders made under the Central Goods and Services Tax Act, State Goods and
Services Tax Act, or Union Territory Goods and Services Tax Act is permitted under the Indian Goods and
Services Tax (GST) framework. The deadlines for submitting GST appeals are examined in this article, along
with any recent extensions, requirements, and unique clauses.
12) Implementation of Goods & Service Tax (Gst) in India Emerging Opportunities & Challenges:
The historic change to the indirect tax system in India with the implementation of the Goods and Services
Tax (GST) would have a significant effect on the modern Indian economy. On July 1, 2017, the Indian
government enacted a major tax reform pertaining to indirect taxes. Currently, the GST is in place in more
than 140 countries worldwide, with the main goals being to uphold system transparency, gradually reduce
tax evasion, and encourage the continued development of infrastructure to meet the rising demands of
businesses, farmers, traders, and citizens of each [Link] will create a single, national indirect tax system
by combining all other indirect taxes under one roof.
13) Awareness and Understanding of GST among Indian Consumers:
This research study examines the degree of understanding, awareness, and acceptance of the Goods and
Services Tax (GST) among Indian consumers in order to assess the efficacy and success of the GST.
Additionally, the piece looks into how the GST has affected the general public's spending habits. The
outcome demonstrates that most customers are aware of the GST structure. Additionally, the analysis shows
that there is no meaningful relationship between respondents' spending patterns and the GST tax structure.
OBJECTIVES OF THE STUDY:
• To analyze the change in market prices before and after GST implementation.
• To study the changes in consumer behavior and spending patterns post-GST.
• Make sure that consumers know exactly what taxes they're paying and why, leading to fairer pricing.
SCOPE OF THE STUDY:
The study on the impact of GST on day-to-day life covers how GST affects consumer prices, alters spending
habits, and influences business operations and compliance. It explores the broader economic effects, such as
on employment and government revenues, offering insights into how GST can improve or challenge
economic health and individual livelihoods.
RESEARCH METHODOLOGY:
Sources of data:

Data Collection: To collect primary data from small-scale businesses and GST-registered shops,
questionnaires can distribute through various channels. They may partner with local business associations
or chambers of commerce to reach a wide range of businesses. Additionally, they I utilize online platforms
or social media to distribute electronic questionnaires. These questionnaires would inquire about the
businesses' experiences with GST, covering topics such as pricing changes, compliance challenges, and

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overall operational impacts. By directly engaging with these businesses, researchers can gather firsthand
insights into the effects of GST on their day-to-day operations.

SAMPLE PEOPLE’S SELCTED FOR STUDY:

• Textile and Garment Manufacturers

• Restaurants and Cafes
• Retail Stores
• Local Markets and Bazaars

STATISTICAL TOOLS

• Percentage Calculation
• Fraction Conversion
• Ratio Analysis
• Data Validation
• Rounding off

LIMITATIONS OF THE STUDY:

This study could have some challenges because figuring out exactly how GST affects many different people
and businesses is complicated. Other changes in the economy that have nothing to do with GST might also
affect what we see, making it hard to tell if GST is the cause. Plus, we might not be able to see all the long-
term effects of GST right away, since those can take years to become clear.
DATA ANALYSIS AND INTERPRETATION
What was the main reason behind introducing GST?
54 responses

The data represents a survey where people were asked about the main reason behind introducing the Goods
and Services Tax (GST). Here's how the responses break down:
- 29% of respondents believe the main reason was to increase overall tax revenue for the government.
- 42.6%, the majority, think it was to unify multiple indirect taxes under a single framework, making the tax
system simpler and more efficient.

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- 16.7% feel it was introduced to reduce the cost of importing goods, possibly making foreign goods cheaper
and more accessible.
- 11.1% believe the aim was to raise the standard of living by possibly making goods and services more
affordable or increasing government revenue for public services.
In simple terms, most people think GST was introduced to make the tax system simpler by combining many
taxes into one. Others see it as a way to increase government revenue, make imported goods cheaper, or
improve the standard of living, but these reasons are less commonly cited.
2)

- 31.5% of the respondents believe GST benefits consumers by reducing the price of all goods and services
uniformly.
- 25.9% think it benefits consumers by offering subsidies on selected goods.
- Another 31.5% see the benefit in GST streamlining the tax system, possibly reducing the overall tax burden.
- 11.1% believe GST benefits consumers by rewarding purchases of goods and services.
This indicates that opinions are quite divided, with the same percentage (31.5%) of respondents believing in
either a uniform reduction in prices or a streamlined tax system as the primary consumer benefits of GST. A
smaller fraction sees subsidies or rewards on purchases as the main benefits.
3)

Based on the
responses from 54 individuals regarding the impact of GST on household product prices:
- 53.7% noticed that prices have increased.
- 18.5% observed prices have decreased.
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- 11.1% saw no significant change in prices.
- 16.7% were not sure or hadn't noticed any change.
In simple terms, more than half of the people feel that the prices of household products have gone up since
GST was introduced. A smaller group thinks prices have gone down, while some haven't seen a change or
haven't paid enough attention to notice.

4) - 53.7%
noticed that prices have increased.
- 18.5% observed prices have decreased.
- 11.1% saw no significant change in prices.
- 16.7% were not sure or hadn't noticed any change.
In simple terms, more than half of the people feel that the prices of household products have gone up since
GST was introduced. A smaller group thinks prices have gone down, while some haven't seen a change or
haven't paid enough attention to notice.

5) From the
responses of 54 people about whether GST has made the tax on household products easier to understand:
- 44.4% feel it's clearer now.
- 24.1% find it more confusing.
- Another 24.1% see no significant difference in their understanding.
- 7.1% are not sure or find the question not applicable to them.

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In simple terms, nearly half of the respondents think GST has made understanding taxes on household
products easier. However, a notable portion finds it more confusing or hasn't noticed a difference in their
level of understanding. A small group is unsure or doesn't find the question relevant. From the responses of
54 people about whether GST has made the tax on household products easier to understand:

6) - 27.8%
say they always check.
- 46.3% do so sometimes.
- 18.5% rarely check.
- 7.4% never check.
- 6% are not sure or find it not applicable.
In simple terms, a significant number of people sometimes or always look at GST rates before buying
household products, but there's also a considerable portion that rarely or never checks. A small group is
unsure or doesn't consider this applicable to them.
7)

- 29.6% believe GST has made household products more affordable.

- 38.9% feel household products have become more expensive because of GS
- 20.4% see no significant change in affordability.
- 11.1% are not sure or haven't noticed any difference.

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Interpreting these responses, a larger portion of people think household products have become more
expensive with the introduction of GST compared to those who find them more affordable. However, a
significant number of individuals have not noticed a significant change or are unsure about the impact.

8) - 20.4%
believe there's no GST on utility bills.
- 40.7% think a uniform GST rate is applied to all utility bills.
- 31.5% say GST rates can vary, affecting the overall bill.
- 7.4% feel utility bills have become tax-free.
In simple terms, most people think that GST applies to utility bills, either as a uniform rate across all types
of bills or as varying rates depending on the utility. A smaller portion believes that there's no GST on these
bills or that utility bills have become tax-free.

9)
- 18.5% believe GST decreases their cost significantly.
- 27.8% feel it keeps their cost unchanged.
- 35.2% say GST increases or decreases their cost depending on GST rates.
- 18.5% think GST increases their cost marginally.
Interpreting these results, the majority view is that GST affects the cost of household staples variably, based
on the GST rates applied. A significant portion believes there's no change in cost, while equal smaller groups
think GST either significantly decreases or marginally increases the prices of these staples.
10)

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- 18.5%
believe GST has no impact on dining out.
- 37% think all restaurants charge the same GST rate.
- 42.6% say GST may vary based on the type of restaurant.
- 2% an apparent typo from the original, assuming meant to be "2 people" feel eating out is now tax-free.
The majority view is that GST on dining out varies depending on the restaurant's type, suggesting different
rates for different kinds of establishments. A significant number also believe that a uniform GST rate applies
across all restaurants. A smaller group thinks GST does not affect their dining bills, and a very minor portion
(or potentially misreported fraction) considers dining out to be tax-free under GST.

11)
- 24.1% believe there is no impact because they are tax-exempt.
- 25.9% think GST decreases their cost due to reduced tax rates.
- 46.3% say GST increases their cost due to higher tax rates.
- 3.7% believe GST removes the cost entirely.
Interpreting these responses, the majority view is that GST has led to an increase in the cost of cooking oils
and spices, attributed to higher tax rates. A smaller portion of people see a benefit in reduced costs or no
impact due to tax exemption. A very minimal number, possibly due to misunderstanding, think that GST
removes the cost of these household essentials entirely.
BIBILIOGRAPHY:
• [Link]
• [Link]

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• [Link]
• [Link]

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