The Goods and Services Tax (GST) regime will weed out black money and usher in an effective taxation system in India. GST is the biggest reform brought in which will make India an attractive destination for foreign investments. The GDP ratio of the nation will go up, thereby helping the government to adhere to fiscal discipline and keeping inflation in check.

 

Much has been written about black money and its ill effects on the Indian economy and society in the last so many years. Efforts were also made to curb out black money from India.

Black money fosters corruption, undermines the right of the common man by reducing him to a lesser human being in the society. The law-abiding individuals who pay taxes on their income appears to be powerless and worthless before the unholy nexus of black money, criminals and politics. The generation of black money were multiple in Indian indirect tax laws. There was no mechanism to keep a appropriate check on unreported income.

In proposed GST there will be usage of PAN (Permanent Account Number) and Aadhar Card will be more frequently and will be required to file GST returns, this will help the income tax department to track every transaction, which it is unable to do today. With this step, more data mapping can be done by the authorities.

The proposed GST Bill envisages that every supply of goods and services will be taxed at the source of origination and every stage of further supply, where the registered re-seller or user will be able to claim the fill credit taxes paid on the previous stage. These GST taxes can used to pay the GST liability arising out of further supply.

In a nutshell, the system drives the tax evader of out of business as no one will be willing to do business with him/her. Thus, GST strikes at the root of where black money gets generated. It is the beginning of the era, where corruption,, black money will gradually subsides and leads to towards development, progress of the society and in turn the nation as a whole.

GST Bill is just not a reform, it is truly real black money law and biggest social reform that the country seen since Independence.

 

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