PROJECT REPORT

ON

SERVICES PROVIDED BY THE BANK THROUGH

“E-BANKING IN INDIA”
SUBMITTED IN PARTIAL FULFILLMENT OF THE REQUIREMENT FOR
THE AWARD OF THE DEGREE

OF

BACHELOR IN COMMERCE
OF
RAMADEVI WOMEN`S UNIVERSITY

SUBMITTED BY:

PRIYANKA MISHRA
+3 III YR. COMMERCE
UNIVERSITY ROLL NO :71R0118035
COLLEGE ROLL NO:BC-18-055

UNDER THE GUIDANCE OF:

MRS. SASWATI MOHANTY

DEPARTMENT OF COMMERCE
KAMALA NEHRU WOMEN`S COLLEGE
BHUBANESWAR

Signature of the External Evaluator Signature of the Internal Evaluator

 CERTIFICATE

This is to certify that the project work entitled "SERVICE PROVIDED BY THE

BANK THROUGH E-BANKING IN INDIA" is the work done by "PRIYANKA

MISHRA" under my supervision and guidance AT KAMALA NEHRU WOMEN`S

COLLEGE, Bhubaneswar, Odisha .

The results obtained in this project have not submitted to any other University or

Institution for the award of any degree.

(SIGNTURE OF THE GUIDE)

SASWATI MOHANTY
HOD, DEPTT.OF COMMERCE
KAMALA NEHRU WOMEN`S COLLEGE
BHUBANESWAR, ODISHA
 DECLARATION

I , Priyanka Mishra of +III 3rd Yr. Commerce ,declare that the project entitled

“SERVICE PROVIDED BY THE BANK THROUGH E-BANKING IN INDIA”,

is the work carried out by me under the guidance of my guide Mrs. Saswati

Mohanty ,HOD,Deptt. of Commerce, Kamala Nehru Women`s College and this has

not been submitted to any other University or Institute for the award of any degree.

(SIGNATURE OF THE STUDENT)

PRIYANKA MISHRA
+3 III YR. COMMERCE
UNIVERSITY ROLL NO :71R0118035
COLLEGE ROLL NO:BC-18-055
 ACKNOWLEDGEMENT

The satisfaction and euphoria that accompany the successful completion of any task

would be incomplete without the mentioning of the people whose constant guidance

and encouragement made it possible. We take pleasure in presenting before you, our

project, which is result of studied blend of both research and knowledge.

We express our earnest gratitude to our project guide, Mrs Saswati Mohanty,HOD,

Department of Commerce for her constant support, encouragement and guidance. We

are grateful for her valuable suggestions and advise in time.

Finally, we express our gratitude to all other members of the department who are

involved either directly or indirectly for the completion of this project.

(SIGNATURE OF THE STUDENT)

PRIYANKA MISHRA
+3 III YR. COMMERCE
UNIVERSITY ROLL NO :71R0118035
COLLEGE ROLL NO:BC-18-055
 CONTENTS

Subject Page No

Chapter-I Introduction 01

Chapter-II History of E-Banking 08

Chapter-III Usages of E-Banking 10

Chapter-IV Review of Literature 11

Chapter-V Objective of the study 15

Chapter-VI Methodology 16

Chapter-VII Discussion 19

Chapter-VIII Data Analysis 24

Chapter-IX Result & Findings 33

Chapter-X Conclusion 34

Chapter-XI Suggestions 36

Bibliography 38
 ABSTRACT

In India, the idea of GST was contemplated in 2004 by the Task Force
on implementation of the Fiscal Responsibility and Budget
Management Act, 2003, named Kelkar Committee. The Kelkar
Committee was convinced that a dual GST system shall be able to tax
almost all the goods and services and the Indian economy shall be
able to have wider market of tax base, improve revenue collection
through levying and collection of indirect tax and more pragmatic
approach of efficient resource allocation. Under the Goods and Service
Tax mechanism, every person is be liable to pay tax on output and
shall be entitled to enjoy credit on input tax paid and tax shall be only
on the amount of value added . The historic GST or goods and
services tax has become a reality. The new tax system was launched
at a function in Central Hall of Parliament on 1st July ,2017 (Friday
midnight). GST, which embodies the principle of "one nation, one tax,
one market" is aimed at unifying the country's $2 trillion economy
and 1.3 billion people into a common market. Under GST, goods and
services fall under five tax categories: 0 per cent, 5 per cent, 12 per
cent, 18 per cent and 28 per cent. For corporates, the elimination of
multiple taxes will improve the ease of doing business. And for
consumers, the biggest advantage would be in terms of a reduction in
the overall tax burden on goods. "Inflation will come down, tax
avoidance will be difficult, India's GDP will be benefitted and extra
resources will be used for welfare of poor and weaker section,"
Finance Minister Arun Jaitley said at GST launch event in Parliament.
The Lok Sabha has finally Passed the Goods and Services Tax Bill and
it is expected to have a significant impact on every industry and every
consumer. Apart from filling the loopholes of the current system, it is
also aimed at boosting the Indian economy. This will be done by
simplifying and unifying the indirect taxes for all states throughout
 India. Keywords: GST, Indian Economy, Positive Impact , Negative
Impact, Central Government, State Government.

INTRODUCTION:

GST stands for Goods and Services Tax levied by the Government in
a move to replace all of the indirect taxes. In India, the idea of GST was
contemplated in 2004 by the Task Force on implementation of the Fiscal
Responsibility and Budget Management Act, 2003, named Kelkar
Committee. The Kelkar Committee was convinced that a dual GST system
shall be able to tax almost all the goods and services and the Indian
economy shall be able to have wider market of tax base, improve revenue
collection through levying and collection of indirect tax and more
pragmatic approach of efficient resource allocation. Under the Goods
and Service Tax mechanism, every person is be liable to pay tax on
output and shall be entitled to enjoy credit on input tax paid and tax shall
be only on the amount of value added . The principal aim of GST is to
eliminate cascading effect i.e. tax on tax and it will lead to bringing about
cost competitiveness of the products and services both at the national and
international market. GST System is built on integration of different taxes
and is likely to give full credit for input taxes. GST is a comprehensive
model of levying and collection of indirect tax in India and it has replace
taxes levied both by the Central and State Governments. GST be levied
and collected at each stage of sale or purchase of goods or services based
on input tax credit method. Under this system, GST-registered
commercial houses shall be entitled to claim credit of the tax they paid on
purchase of goods and services as a part of their day to day businesses.

The historic GST or goods and services tax has become a reality.
The new tax system was launched at a function in Central Hall of
Parliament on 1st July ,2017 (Friday midnight). GST, which embodies the
principle of "one nation, one tax, one market" is aimed at unifying the
country's $2 trillion economy and 1.3 billion people into a common
market. Under GST, goods and services fall under five tax categories: 0
per cent, 5 per cent, 12 per cent, 18 per cent and 28 per cent. For
corporates, the elimination of multiple taxes will improve the ease of
doing business. And for consumers, the biggest advantage would be in
terms of a reduction in the overall tax burden on goods. "Inflation will
come down, tax avoidance will be difficult, India's GDP will be benefitted
and extra resources will be used for welfare of poor and weaker section,"
Finance Minister Arun Jaitley said at GST launch event in Parliament.
The Lok Sabha has finally Passed the Goods and Services Tax Bill and it
is expected to have a significant impact on every industry and every
consumer. Apart from filling the loopholes of the current system, it is also
aimed at boosting the Indian economy. This will be done by simplifying
and unifying the indirect taxes for all states throughout India.
Brief history of GST (in India):

The reform of India's indirect tax regime was started in 1986

by Vishwanath Pratap Singh, Finance Minister in Rajiv Gandhi’s
government, with the introduction of the Modified Value Added Tax
(MODVAT). Subsequently, Prime Minister P V Narasimha Rao and his
Finance Minister Manmohan Singh, initiated early discussions on a Value
Added Tax (VAT) at the state level. A single common "Goods and Services
Tax (GST)" was proposed and given a go-ahead in 1999 during a meeting
between the Prime Minister Atal Bihari Vajpayee and his economic advisory
panel, which included three former RBI governors IG Patel, Bimal
Jalan and C Rangarajan. Vajpayee set up a committee headed by
the Finance Minister of West Bengal, Asim Dasgupta to design a GST model.

The Asim Dasgupta committee which was also tasked with putting in
place the back-end technology and logistics (later came to be known as the
GST Network, or GSTN, in 2015). It later came out for rolling out a uniform
taxation regime in the country. In 2002, the Vajpayee government formed a
task force under Vijay Kelkar to recommend tax reforms. In 2005, the
Kelkar committee recommended rolling out GST as suggested by the 12th
Finance Commission.

After the defeat of the BJP-led NDA government in the 2004 Lok

Sabha election and the election of a Congress-led UPA government, the new
Finance Minister P Chidambaram in February 2006 continued work on the
same and proposed a GST rollout by 1 April 2010. However, in 2011, with
the Trinamool Congress routing CPI(M) out of power in West Bengal, Asim
Dasgupta resigned as the head of the GST committee. Dasgupta admitted in
an interview that 80% of the task had been done.

The UPA introduced the 115th Constitution Amendment Bill on 22

March 2011 in the Lok Sabha to bring about the GST. It ran into opposition
from the Bharatiya Janata Party and other parties and was referred to a
Standing Committee headed by the BJP's former Finance Minister Yashwant
Sinha. The committee submitted its report in August 2013, but in October
2013 Gujarat Chief Minister Narendra Modi raised objections that led to the
bill's indefinite postponement. The Minister for Rural Development Jairam
Ramesh attributed the GST Bill's failure to the "single handed opposition of
Narendra Modi".

In the 2014 Lok Sabha election, the Bharatiya Janata Party (BJP)-

led NDA government was elected into power. With the consequential
dissolution of the 15th Lok Sabha, the GST Bill – approved by the standing
committee for reintroduction – lapsed. Seven months after the formation of
the then Modi government, the new Finance Minister Arun
Jaitley introduced the GST Bill in the Lok Sabha, where the BJP had a
majority. In February 2015, Jaitley set another deadline of 1 April 2017 to
implement GST. In May 2016, the Lok Sabha passed the Constitution
Amendment Bill, paving way for GST. However, the Opposition, led by the
Congress, demanded that the GST Bill be again sent back for review to the
Select Committee of the Rajya Sabha due to disagreements on several
statements in the Bill relating to taxation. Finally, in August 2016, the
Amendment Bill was passed. Over the next 15 to 20 days, 18 states ratified
the Constitution amendment Bill and the President Pranab Mukherjee gave
his assent to it.

A 21-member selected committee was formed to look into the

proposed GST laws. After GST Council approved the Central Goods and
Services Tax Bill 2017 (The CGST Bill), the Integrated Goods and Services
Tax Bill 2017 (The IGST Bill), the Union Territory Goods and Services Tax
Bill 2017 (The UTGST Bill), the Goods and Services Tax (Compensation to
the States) Bill 2017 (The Compensation Bill), these Bills were passed by the
Lok Sabha on 29 March 2017. The Rajya Sabha passed these Bills on 6
April 2017 and were then enacted as Acts on 12 April 2017. Thereafter,
State Legislatures of different States have passed respective State Goods and
Services Tax Bills. After the enactment of various GST laws, Goods and
Services Tax was launched all over India with effect from 1 July 2017. The
Jammu and Kashmir state legislature passed its GST act on 7 July 2017,
thereby ensuring that the entire nation is brought under a unified indirect
taxation system. There was to be no GST on the sale and purchase of
securities. That continues to be governed by Securities Transaction
Tax (STT).

The GST was launched at midnight on 1 July 2017 by the President

of India, and the Government of India. The launch was marked by a historic
midnight (30 June – 1 July) session of both the houses of parliament
convened at the Central Hall of the Parliament. Though the session was
attended by high-profile guests from the business and the entertainment
industry including Ratan Tata, it was boycotted by the opposition due to the
predicted problems that it was bound to lead for the middle and lower class
Indians. The tax was strongly opposed by the opposing Indian National
Congress. It is one of the few midnight sessions that have been held by the
parliament - the others being the declaration of India's independence on 15
August 1947, and the silver and golden jubilees of that occasion. After its
launch, the GST rates have been modified multiple times, the latest being on
22 December 2018, where a panel of federal and state finance ministers
decided to revise GST rates on 28 goods and 53 services.

Members of the Congress boycotted the GST launch altogether. They

were joined by members of the Trinamool Congress, Communist Parties of
India and the DMK. The parties reported that they found virtually no
difference between the GST and the existing taxation system, claiming that
the government was trying to merely rebrand the current taxation
system. They also argued that the GST would increase existing rates on
common daily goods while reducing rates on luxury items, and affect many
Indians adversely, especially the middle, lower middle and poorer income
groups.
NEED FOR GST IN INDIA

 Present tax system allows is diversity of taxes, the introduction of GST is

likely to unique it.

 Many areas of Services which are untaxed. After the introduction of GST
they will also get covered.

 GST may help to avoid confusions caused by present complex tax

structure and will help in development of a common national market.
 Excise, VAT, CST have the cascading effects of taxes. Therefore, there
will be end up in paying tax on tax. GST will replace existing all
present taxes.
 GST will lead to credit availability on throughway purchases and
reduction in obedience requirements.

 Applying of GST will do more than simply redistribute the tax burden
from one sector or Group in the economy to another.
 Achieves, uniformity of taxes across the territory, regardless of place of
manufacture or distribution.

 Provides greater certainty and transparency of taxes.

 Ensures tax compliance across the country.

 GST will avoid double taxation to some extent.

 The effective implementation of GST makes sure that India provides a

tax system that is almost similar to the rest of world where GST
implemented.

 GST will also improve the International level cost competition of

various native Goods and Services. GST will provide impartial tax
structure that is neutral to business processes and geographical
locations within India.
 If the GST is implemented in the true spirit, it will have many positives
effects for the stakeholders and will lead to a better friendly tax
 environment.
Features of GST:

 GST is applicable on ‘supply’ of goods or services as against the

present concept on the manufacture of goods or on sale of goods or on
provision of services.

 GST is based on the principle of destination-based consumption

taxation as against the present principle of origin-based taxation.

 It is a dual GST with the Centre and the States simultaneously

levying tax on a common base. GST to be levied by the Centre would be
called Central GST(CGST) and that to be levied by the States would be called
State GST (SGST).

 An Integrated GST (IGST) would be levied an inter-state supply

(including stock transfers) of goods or services. This shall be levied and
collected by the Government of India and such tax shall be apportioned
between the Union and the States in the manner as may be provided by
Parliament by Law on the recommendation of the GST Council.

 Import of goods or services would be treated as inter-state supplies

and would be subject to IGST in addition to the applicable customs duties.

 CGST, SGST & IGST would be levied at rates to be mutually agreed

upon by the Centre and the States. The rates would be notified on the
recommendation of the GST Council. In a recent meeting, the GST Council
has decided that GST would be levied at four rates viz. 5%, 12%, 16% and
28%. The schedule or list of items that would fall under each of these slabs
has been worked out. In addition to these rates, a cess would be imposed on
 “demerit” goods to raise resources for providing compensation to States as
States may lose revenue owing to the implementation of GST.

 GST would replace the following taxes currently levied and collected
by the Centre:-

a) Central Excise Duty

 b) Duties of Excise (Medicinal and Toilet Preparations)

 c) Additional Duties of Excise (Goods of Special Importance)

d) Additional Duties of Excise (Textiles and Textile Products)

 e) Additional Duties of Customs (commonly known as CVD)

 f) Special Additional Duty of Customs(SAD)
 g) Service Tax
 h) Cesses and surcharge in so far as they relate to supply of goods and
services.
 
 State taxes that would be subsumed within the GST are:-

a) State VAT

b) Central Sates Tax

 c) Purchase Tax

 d) Luxury Tax
 e) Entry Tax (All forms)
 f) Entertainment Tax and Amusement Tax (except those levied by the local
bodies)
 g) Taxes on advertisements
 h) Taxes on lotteries, betting and gambling
 i) State cesses and surcharges in so far as they relate to supply of goods
and services.
GST would apply on all goods and services except Alcohol for human
consumption.
 GST on five specified petroleum products (Crude, Petrol, Diesel, ATF &
Natural Gas) would by applicable from a date to be recommended by the
GSTC.
 

 Tobacco and tobacco products would be subject to GST. In addition,

the Centre would have the power to levy Central Excise duty on these
products. 

 A common threshold exemption would apply to both CGST and SGST.

Tax payers with an annual turnover not exceeding Rs.20 lakh (Rs.10 Lakh
for special category States) would be exempt from GST. For small taxpayers
with an aggregate turnover in a financial year upto 50 lakhs, a composition
scheme is available. Under the scheme a taxpayer shall pay tax as a
percentage of his turnover in a State during the year without benefit of Input
Tax Credit. This scheme will be optional.

 The list of exempted goods and services would be kept to a minimum

and it would be harmonized for the Centre and the States as well as across
States as far as possible.

 Exports would be zero-rated supplies. Thus, goods or services that are

exported would not suffer input taxes or taxes on finished products.

 Credit of CGST paid on inputs may be used only for paying CGST on
the output and the credit of SGST paid on inputs may be used only for
paying SGST. Input Tax Credit (ITC) of CGST cannot be used for payment of
SGST and vice versa. In other words, the two streams of Input Tax Credit
(ITC) cannot be cross-utilised, except in specified circumstances of inter-
state supplies for payment of IGST. The credit would be permitted to be
utilised in the following manner:-

o a) ITC of CGST allowed for payment of CGST & IGST in that

order;

o b) ITC of SGST allowed for payment of SGST & IGST in that

order;
  

o c) ITC of IGST allowed for payment of IGST, CGST & SGST in

that order.

 Accounts would be settled periodically between the Centre and the

States to ensure that the credit of SGST used for payment of IGST is
transferred by the Exporting State to the Centre. Similarly, IGST used for
payment of SGST would be transferred by the Centre to the Importing State.
Further, the SGST portion of IGST collected on B2C supplies would also be
transferred by the Centre to the destination State. The transfer of funds
would be carried out on the basis of information contained in the returns
filed by the taxpayers.laws, regulations and procedures for levy and
collection of CGST and SGST would be harmonized to the extent possible.

The whole GST system will be backed by a robust IT system. In this

regard, Goods and Services Tax Network (GSTN) has been set up by the
Government. It will provide front end services and will also develop back end
IT modules for States who opted for the same.

Tax Structure Before Introducing GST:

Suppose say a manufacturer buys raw material from a Vendor. He

needs to pay a VAT (Value Added Tax-12.5%) along with the cost of the
product. The manufacturer incurs some cost to produce the product. He
then adds some profit to it and sells it to Wholesaler. The Wholesaler
again needs to pay tax (VAT+ Excise Duty=12.5%+12.5%=25%) on the
product. The Wholesaler again adds some profit on the product before
selling the product to retailer.

The Retailer again needs to pay VAT (12.5%) for this product. Then
he adds some profit margin and again sells it to customers. For the same
product before reaching customers hands multiple taxes are levied and
 the cost of the product increases significantly.

Tax Structure After GST Implementation:

GST Law has replaced many indirect tax laws that previously
existed in India. In place of VAT, Service Tax etc the Government has
Come up with Central GST & State GST (12%+12%). Suppose say the
manufacturer after adding his profit sells the product to the Wholesaler
at Rs.140. The Wholesaler then sells the product to the retailer at Rs.154
after adding a profit of 10% margin. The retailer then again adds 10% as
profit which makes the cost of the product Rs.169.5 and a 12% CGST +
12% SGST is added to this product which the cost of the product stand
at Rs.210.18. So, by the implementation of GST the cost of the product
can be reduced. Before GST, tax on tax was calculated and tax was paid
by every purchaser including the final consumer. The taxation on tax is
called the Cascading Effect of Taxes. But GST is payable at the final point
of consumption, meaning that the ‘taxable event’ will be the ‘supply of
goods’ and the ‘supply of services’.

Taxes which GST replaced At Central Level:

 Central Excise Duty

 Additional Excise Duty
 Service Tax
 Additional Customs Duty commonly known as Countervailing Duty
 Special Additional Duty of Customs

At State Level:

 Subsuming of State Value Added Tax/Sales Tax

 Entertainment Tax (other than the tax levied by the local bodies),
Central Sales Tax (Levied by the Centre and collected by the
 States),
 Octroi and Entry tax
 Purchase Tax
 Luxury Tax
 Taxes on lottery, betting and gambling

Types of GST namely:

 UTGST – Union Territory GST, collected by the Union Territory

 IGST – Integrated GST, collected by the Central Govt.
 SGST – State GST, collected by the State Govt.
 CGST – Central GST, collected by the Central Govt.

Various slabs of GST in India:

GST slabs are pegged at 5%, 12%, 18% & 28%. The products like
Milk, Curd, Lassi, Eggs, Unpacked Food Grains, Fresh Vegetables,
Prasad, Salt, Khadi purchased from Khadi and Village Industries stores,
Clay idols, brooms, Cotton seed oil cake, Charkha. Hotels and lodges with
tariff below Rs 1,000, Educational & Health Services, Grandfathering
service has been exempted under GST. Goods like petroleum, alcohol and
tobacco are excluded.

Advantages of GST:

 GST is a transparent tax and also reduce number of indirect taxes.

 GST will not be a cost to registered retailers therefore there will be
no hidden taxes and the cost of doing business will be lower.
 GST is backed by the GSTN, which is a fully integrated tax platform
to deal with all aspects of GST.
 Life gets simpler- GST will replace 17 indirect tax levies and
compliance costs will fall.
 Revenue will get a boost- Evasion set to drop - Input tax credit will
encourage suppliers to pay taxes - States and Centre will have dual
oversight.
The number of tax-exempt goods will decline.

 A common market-It's currently fragmented along state lines,

pushing costs up 20- 30%.
 Increased efficiency in Logistics: At the state borders slow movement
of trucks. In India, they travel 280 km a day as compared with 800
km in the US.
 Investment boost-For many capital goods, input tax credit is not
available.
 Boost for E-Commerce Sector- Freeing up online State restrictions.
 Make in India (a) Manufacturing will get more competitive as GST
addresses cascading of tax, inter-state tax, and high logistics costs
and fragmented market. (b)Increased protection from imports as
GST provides for appropriate countervailing duty.

Less developed states get a lift- The current 2% inter-state levy means
production is kept within a state. Under the GST national market, this can
be dispersed, creating opportunities for others.

Disadvantages of GST:

 Most of the dealer’s don’t pay central excise tax and cheat the
government by simply giving the VAT. But all of those dealers
would now be forced to pay GST.
 GST is a mystifying term where double tax is charged in the name
of a single tax.
 For consumers, it will be a mixed bag as some goods become
cheaper while others will be expensive.
 Services will become expensive e.g. Telecom, banking, airline etc.
 Increased costs due to software purchase
 Being GST-compliant
 GST will mean an increase in operational costs
 GST came into effect in the middle of the financial year
 GST is an online taxation system
 SMEs will have a higher tax burden
 Being a new tax, it will take some time for the people to understand
its implications.
 It is easier said than done. There are always some complications
attached. It is a consumption based tax, so in case of services the
place where service is provided needs to be determined.
 If actual benefit is not passed to consumer and seller increases his
profit margin, the prices of Goods can also see a rising trend.
 The introduction of GST in the country will impact real estate
market. This would increase new home buying price by 8% and
reduce buyers‟ market by 12%.
 The short-term impact of GST is expected to be neutral-to negative
for the broader economy.
 Production processes are likely to take some time to align with the
new framework as firms adjust to the input tax credit system and
better manage working capital requirements.
OBJECTIVES OF THE STUDY

1. To study the need of Goods and Services Tax (GST).

2. To study the impact of Goods and Services Tax (GST) on Indian

economy.

RESEARCH METHODOLOGY

This study is descriptive in nature and it used the exploratory

technique. The data for the study were gathered from the secondary
sources such as journals, articles published online and offline on
various newspapers and websites.

IMPACT OF GST ON PRICES OF GOODS AND SERVICES

Tax experts claimed that the previous practice of tax on tax – for example,
VAT was being charged on not just cost of production but also on the
excise duty that was added at the factory gate leading to production cost
building up but now all had been gone when GST is rolled out. The prices
of consumer durables, electronic products and ready-made garments will
be available at low price after rolled out GST. In other aspects, for goods
which were taxed at low rate, the impact of GST brings price increment.
Services bearing essential ones like ambulance, cultural activities,
pilgrimages etc. were exempted from levy are same. India has seen the
strongest tax reform that aims to do away with various – tax system on
goods and services and bring them under one rate. We can draw the
following impact of GST on prices:

The government rolled out the much talked about Goods and Services
Tax (GST) on the midnight of June 30. The GST Council has fixed the
tax rates, keeping a view on all goods and services; they are classified
under tax slabs 0 % (exempted ones), 5%, 12%, 18% & 28%.

Here is a list of some items which are completely exempt from the GST
regime:

 The unprocessed cereals, rice & wheat etc.

 The unprocessed milk, vegetables (fresh), fish, meat, etc.

 Unbranded Atta, Besan or Maida.

 Kid’s colouring book/drawing books.

 Sindoor/Bindis, bangles, etc

 Below is a list of the sectors which are negatively or positively affected

by GST.
III. SECTOR WISE POSITIVELY IMPACT OF GST

Sectors Tax Implications under GST

Auto Commercial Vehicle To marginally b 1 compa t th existi tax

(CV)/Two wheelers (2W) reduce y % red o e ng
structure.
Positive

Small cars which less than 4 meter length and

more than 1500 cc engine tax rates to reduce
by 2-2.5% compared to the existing tax
Auto – Small cars structure. Positive

Midsized cars <1500 cc &<4 meters in length

Auto – Midsized cars and and SUV rates would come down by 8%
SUV and12% respectively. Positive

Effective tax rate in essential goods (soaps,

Consumer goods – toothpaste, edible oil and hair oils) under
essential items various tax slabs – Positive

Footwear tax rates (<Rs 500) to reduce to 5%

Consumer goods – from 9.5% and <Rs500 to reduce to 18% from
Footwear 24-30%– Positive

Effective tax under GST would be 28% along

with additional Cess and other taxes. GST rate
in cigarettes according to the current rate will
Consumer goods – gradually increase over the next 5-6 years –
Cigarettes Positive

Organised players to benefit from higher tax

rate in the long term, as they gain market
share on reduced pricing spread between
organised and unorganised players. However,
higher tax rate may lead to tax evasion through
loopholes, which is a concern from organised
Building Materials
players.
 In Consolidation of warehouses across the
country with free movement of goods will lead
to higher volumes for logistic companies.
Execution of the same, however, might take
Logistics some time as unorganised players will have to
adapt to new systems under GST.

SECTORS NEGATIVELY EFFECTED BY GST

Sectors Tax Implications under GST

Hotel more Tax rate on fine dining restaurants increased to 28% from
than Rs 5000 15%. This will result in room rentals hikes, with
room rental consequent impact on hotel occupancies.- Negative

Tax increased to 18% from 15%. This tax revision will

Restaurants & affect the fine dining restaurant industry which has
fine dinning already seen significant pressure on its sales due to macro
environment slowdown. – Negative

Garments >Rs 1000 will be taxed at 12% instead of 7%.

This will adversely impact business as price hikes would
Branded
lead to late recovery in sales.
Apparels
 III. CONCLUSION

At the end we can say clearly with no doubt that it is the biggest ever
change in tax structure of India. There is a fall in prices of Auto
Commercial Vehicle, Two wheelers, Small cars, Midsized cars and
SUV, essential items, Footwear, Building Materials etc. and
education, healthcare are going to be exempted from GST but on
the other hand, price of some other goods and services increased after
GST like Hotel room rental, Restaurants & fine dining and Branded
Apparels. There was threat of inflation before GST rolled out. It can be
concluded that GST has been going to be an historical record for its
full fledge implementation and hopefully this biggest historical reform
will result in ease of doing business in India.

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Journal Paper:

[1] Jaspreet Kaur, Goods and service tax (GST) and its impact;
International Journal of Applied Research 2016; 2(8): 385-387.
[2]Shakir Shaik, S.A.Sameera, Sk.C. Firoz. Does Goods and Services
Tax (GST) Leads to Indian Economic Development?; IOSR Journal of
Business and Management (IOSR-JBM). Volume 17, Issue 12 .Ver. III
(Dec. 2015), PP 01-05.
Websites:

[3] http://economictimes.indiatimes.com/news/economy/policy

[4] http://indianexpress.com/article/explained/gst-bill-parliament

[5] http://www.ey.com/in/en/services/ey-goods-and-services-tax-
gst