Study of Consumer Perception towards Implementation of GST and its Effects

Abstract

GST the biggest tax reform in India founded on the notion of One Nation, One Market, One Tax. The GST rollout, with a single stroke, has converted India into a unified market of 1.3 billion citizens. The rollout has renewed the hope of India’s fiscal reform program regaining momentum and widening the economy. The idea behind implementing GST across the country is that it would offer a win-win situation for everyone. This paper investigates the consequences behind the GST and the consumer responses. It has been more than 160 days since GST has been implemented in India. While the industry was very apprehensive, the GST transition has been smooth. The consumers agreed that GST has long term benefits. According to the survey, most consumer supported GST easily as comparing the businessmen. The primary impact to be felt by the consumers would change in prices of goods and services on account of GST rates. In terms of impact in prices, while services would mostly be more expensive in the initial phases, impact on prices of goods could be a mixed bag. In the long run, once the benefits of GST are expected to kick in in terms of higher input credits and reduction in cascading effect, it is anticipated that the inflationary effect will come down and prices, in general, would come down and stabilize.