“The Goods and Services Tax (GST) system has faced periodic challenges in revenue generation since its implementation.” Examine the factors affecting GST revenue growth in India and suggest measures to ensure more robust collections.
Kartavya Desk Staff
Topic: Mobilization of resources
Topic: Mobilization of resources
Q5. “The Goods and Services Tax (GST) system has faced periodic challenges in revenue generation since its implementation.” Examine the factors affecting GST revenue growth in India and suggest measures to ensure more robust collections. (15 M)
Difficulty Level: Medium
Reference: TH
Why the question The recent slowdown in GST revenue growth, making it relevant to examine the broader challenges affecting revenue generation since the implementation of GST in India. Key Demand of the question To analyze the factors hindering consistent GST revenue growth and suggest measures to enhance the robustness of collections. Structure of the Answer: Introduction Briefly mention the introduction of GST in 2017 as a significant tax reform aimed at unifying the tax system, but note the periodic challenges in revenue growth. Body: Identify factors affecting GST revenue growth: Economic slowdown, variations in consumption patterns, and uneven growth across sectors. Issues related to compliance, tax evasion, and inefficiencies in the refund process affecting overall collections. Suggest measures for improvement: Strengthen compliance mechanisms, streamline refund processes, and improve tax collection efficiency. Enhance coordination between central and state governments, and leverage technology for better monitoring and data analytics. Conclusion: Summarize the need for addressing structural and administrative challenges in the GST system to ensure steady revenue growth and fiscal stability.
Why the question The recent slowdown in GST revenue growth, making it relevant to examine the broader challenges affecting revenue generation since the implementation of GST in India.
Key Demand of the question To analyze the factors hindering consistent GST revenue growth and suggest measures to enhance the robustness of collections.
Structure of the Answer:
Introduction Briefly mention the introduction of GST in 2017 as a significant tax reform aimed at unifying the tax system, but note the periodic challenges in revenue growth.
• Identify factors affecting GST revenue growth: Economic slowdown, variations in consumption patterns, and uneven growth across sectors. Issues related to compliance, tax evasion, and inefficiencies in the refund process affecting overall collections.
• Economic slowdown, variations in consumption patterns, and uneven growth across sectors.
• Issues related to compliance, tax evasion, and inefficiencies in the refund process affecting overall collections.
• Suggest measures for improvement: Strengthen compliance mechanisms, streamline refund processes, and improve tax collection efficiency. Enhance coordination between central and state governments, and leverage technology for better monitoring and data analytics.
• Strengthen compliance mechanisms, streamline refund processes, and improve tax collection efficiency.
• Enhance coordination between central and state governments, and leverage technology for better monitoring and data analytics.
Conclusion: Summarize the need for addressing structural and administrative challenges in the GST system to ensure steady revenue growth and fiscal stability.