On July 1, 2025, the Goods and Services Tax (GST) will complete eight years since its rollout. It was introduced in 2017 as a major step towards economic integration. GST replaced a maze of indirect taxes with a single and unified system. It made tax compliance easier, reduced costs for businesses and allowed goods to move freely across states. According to the government, by improving transparency and efficiency, GST helped lay the foundation for a stronger and more integrated economy.
A recent survey report by Deloitte claims that 85 per cent of respondents reported a positive experience with GST, marking the fourth consecutive year of growing industry sentiment. While nearly 10 per cent of respondents indicated a neutral experience, pointing to opportunities for further improvement, particularly in areas such as expense management and unlocking input tax credit (ITC). And 5 per cent reported a negative experience as well, citing concerns over the lack of clarity on new proposals, retrospective amendments, frequent unwarranted notices despite earlier clarifications and inconsistencies in audit and litigation practices by tax authorities.
Tax Compliance and Litigation expert Abhishek Raja Ram told ETV Bharat that the intention behind GST was very good, and now everyone is beginning to feel that things are moving in the right direction. He added that while the government’s intention is commendable, the key concern remains the glitches in the GST filing portal. The company managing the portal should act proactively to resolve these issues as they cause delays in filing during crucial periods.
MSME experience sees notable gains
According to the survey, there is a significant improvement in the GST experience for Micro, Small and Medium Enterprises (MSMEs), with satisfaction levels rising from 78 to 82 per cent in the past year. Key measures that supported this improvement include quarterly return filing with monthly payment options and relaxed thresholds for compulsory GST registration.
The report also highlights that digitalisation has played a central role in these improvements. As many as 99 per cent of businesses reported in a survey that their IT systems are fully or partially ready to handle GST audits and respond to departmental notices. The auto-population of returns using e-invoicing data was cited as the most valued feature of the GST portal, significantly easing compliance for businesses.
Priorities for the next phase
Looking ahead, the report outlines a series of recommendations under what it terms GST 2.0, aimed at strengthening the tax framework and improving ease of doing business. Key priorities include enhancing the dispute resolution mechanism, rationalising GST rates across sectors and ensuring audit uniformity between central and state authorities.
Challenges
Despite these advancements, the report also acknowledges ongoing challenges. It says that businesses continue to face hurdles in obtaining timely refunds, understanding GST implications for digital and evolving business models, and managing expansive, pro-revenue legal interpretations. On the compliance front, the need for pan-India standardisation of registration documents, quicker timelines, and streamlined processes for amendments was highlighted as key to improving the registration experience. The adoption of digital tools and seamless ITC flow has emerged as a critical enabler, especially for MSMEs, contributing to improved tax compliance and business sentiment.
Methodology
The Deloitte survey was conducted online with C-suite and C1-level executives across a range of industries and company sizes. The questionnaire comprised 34 questions focused on GST implementation and reform, covering various dimensions of the framework. A total of 963 responses were collected from participants across eight industries, using a mix of multiple-select, single-select, ranking, and open-ended formats.
Another independent Chartered Accountant and Tax Expert, Yogendra Kapoor, told ETV Bharat that India’s Manufacturing and Service sector has benefited the most from the introduction of GST due to efficient Supply chain management, reduced logistical cost and a robust system of checks and balances on transactions undertaken and online verification of Input credits. Transport of Agricultural produce, cost of compliance for Small Traders and service providers in remote and non-remote areas can be adjudged as being overburdened and underserved persons.
According to him, the challenge of delayed refunds affects the working capital needs of the business. Litigations arising out of registration and assessment require discretionary powers to officers to apply their mind before raising objections and demands mechanically, and all appellate proceedings need to be settled in time time-bound manner to address the policy issue of ease of doing business and belief of Tax terrorism by certain masses, he added.
Structure of the GST System
GST rates in India are determined by the GST Council, which includes representatives from the Union and State or Union Territory governments. The current GST structure consists of four main rate slabs: 5 per cent, 12 per cent, 18 per cent and 28 per cent. These rates apply to most goods and services across the country.
In addition to the main slabs, there are three special rates: 3 per cent on gold, silver, diamond and jewellery, 1.5 per cent on cut and polished diamonds and 0.25 per cent on rough diamonds. A GST Compensation Cess is also levied on select goods such as tobacco products, aerated drinks and motor vehicles at varying rates. This cess is used to compensate states for any revenue loss resulting from the transition to the GST system.
On 1 July 2025, the Goods and Services Tax (GST) will complete eight years since its rollout. Introduced in 2017 as a major step towards economic integration, GST replaced a maze of indirect taxes with a single, unified system. It made tax compliance easier, reduced costs for businesses, and allowed goods to move freely across states. By improving transparency and efficiency, GST helped lay the foundation for a stronger, more integrated economy.
Prime Minister Narendra Modi had called it “a path-breaking legislation for New India.” Eight years on, the numbers speak for themselves. In 2024–25, gross GST collections hit a record ₹22.08 lakh crore, marking a year-on-year growth of 9.4 per cent. This rise reflects the growing formalisation of the economy and improved tax compliance.
A recent report by Deloitte titled GST@8 described the past year as a blockbuster for GST. It credited the government’s timely reforms, clear guidance to taxpayers, and steady upgrades on the GST portal as key reasons behind this success. These measures not only improved the ease of doing business but also strengthened the tax base.
Key features of GST
One Nation, One Tax: GST brought together a wide range of indirect taxes under one umbrella. It replaced levies like excise duty, service tax, VAT and others. This helped remove the cascading effect of taxes and brought consistency in the tax system across the country.
Dual Structure: The GST system is designed with a dual model. It includes Central GST (CGST) and State GST (SGST) for transactions within a state. For trade between states, Integrated GST (IGST) applies.
Destination-Based Tax: GST is charged at the point of consumption rather than origin. This ensures a smooth flow of tax credit across the supply chain and lowers the overall tax burden on the final consumer.
Input Tax Credit (ITC): Businesses can claim credit for taxes paid on inputs. This prevents tax on tax and reduces costs across the production and distribution chain.
Threshold Exemption: Small businesses with a turnover below a certain limit are exempt from GST. This makes compliance easier and protects micro enterprises from excessive paperwork.
Composition Scheme: This scheme is meant for small taxpayers with a turnover below a set limit. It allows them to pay GST at a fixed rate on their turnover. The scheme involves less documentation and simpler returns.
Online Compliance: All GST processes, including registration, return filing and payments, are done through the GSTN portal. This digital approach improves efficiency and ease of doing business.
Sector-Specific Exemptions: Sectors such as healthcare and education are either exempt or taxed at lower rates. This keeps essential services within reach for all.
Account Settlement: GST ensures smooth sharing of revenues between the Centre and States. Credit transfers are done seamlessly to maintain fiscal balance and cooperation.
Source: etv bharat
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