News

Three years on, GST hasn’t lived up to its billing

Three years on, GST hasn’t lived up to its billing

July 2020 marks the completion of three years since the launch of the good and services tax (GST) regime. That is long enough to allow us to take stock of how well the new tax regime is performing. If it is still beset with “teething troubles”, then that must mean that there are structural flaws in its character and design, which make effective implementation near impossible. If such flaws are not undermining its effectiveness, the regime should show signs of delivering the results it was explicitly or implicitly expected to yield.

An annual statistical report recently released by the Goods and Services Tax Network (GSTN) provides a view of the performance of the regime since its inception in July 2017 till the end of financial year 2019-20. That more or less leaves out the period when the post-Covid lockdown affected revenues extremely adversely, so the numbers are not distorted by that noise. The evidence is disappointing, to say the least, though there are some positive trends.

Top