India GST: Sweeping tax reform introduced

Vastavam web: After 17 years of struggle, India has adopted the new tax system named GST in the mid night of Friday at Parliament central hall. The new tax system GST is expected to influence the 130 crores of people of India and it would help the economy to grow for further stages. The historic overhaul of the existing tax legislation was carried out at a special midnight session of parliament. India says introducing GST will cut red tape and increase tax revenues, fueling economic growth. Finance Minister Arun Jaitley says the reform will help the economy grow by 2%. But businesses have been asking for more time to implement changes, worried that they are not ready for the move to the new system. Many do not even have a computer to register on the GST network.  Under the new system, goods and services will be taxed under four basic rates – 5%, 12% 18% and 28%. Some items like vegetables and milk have been exempted from GST, but will still be subject to existing taxes. The price of most goods and services are expected to increase in the immediate aftermath of the tax.