Benefits of GST has to be availed by the ultimate consumers
The benefits of Goods and Service Tax (GST) has to be passed on to the ultimate consumers by the importers, suppliers, distributors, dealers, wholesaler and retailers.
The GST, officiating secretary of ministry of economic affairs, Sonam P Wangdi said the GST is a improve version of tax which is a self regulating tax which is called as destination consumer base tax that is an adjustment happened at every stages of the value chain from raw materials supplier to ultimate consumers.
According to the press release from the department of trade under ministry of economic affairs GST follows a multi stage collection mechanism and credit of tax paid at previous stage is available for set off at the next stage of the transaction. “The GST system is expected to enhance competitiveness of the industry and increase consumer welfare.”
GST is a single integrated taxation system within India that combines seventeen (17) state and central taxes into a single tax of six tax bands varying from zero to 28 percent. It is a destination and consumption based tax, imposed to the final consumer.
Sonam P Wangdi said that export from India to any country will be zero rated, which means that import into Bhutan will become cheaper.
However, he added that the price impact in Bhutan will be fully ascertained after the GST system in India is streamlined and fully implemented.
The consumer can expect the prices of the commodities to be cheaper in Bhutan than in India. Study on item wise price difference is currently being carried out by the department of trade and office of the consumer protection (OCP).
In India, seven percent of the items come under the exempted list, 14 percent fall in the 5 percent tax band, 17 percent in the 12 percent tax band, 43 percent under the 18 percent tax band and 19 percent of the items will fall under the 28 percent tax band.
The press release stated that about 81 percent of all goods and services fall below or in the 18 percent tax band and the balance items will fall under the 28 percent tax band.
To avail the benefits of the GST, Sonam P Wangdi said that it must be imported through GST- registered entities in India.
“All importers, suppliers, distributors, dealers, wholesalers and retailers are advice to import goods from GST regis- tered entities in India and ensure that benefits of all in price is passed down to the consumers.”
“Non compliance with the notification will be dealt as per the consumer protection act provisions.”
OCP is empowered by Consumer Protection Act of Bhutan 2012 to ensure that the licensed business entities do not mislead and give false information to consumers regarding prices or method of determining prices.
Further, section 34 of the consumer protection rules and regulation 2015 strictly prohibit business entities from distorting the information impairing the consumers to make informed decision.
“The defaulters shall be liable to pay fines equivalent to the value of the goods or services or the business license may also be revoked.”
Meanwhile, with the introduction of GST in India, the price of goods of Indian origin will fall in the country that for top ten commodities will be dropped by 14 percent and prices of consumable goods are expected to fall by around five percent on an average. Besides that raw materials will be become cheaper for the manufacturers and there will be no impact on essential goods like vegetables, rice, oil, salt, sugar milk, etc.
And for import of vehicle not exceeding 1500cc are expected to drop by 13.6 percent and those exceeding above 1500cc are expected to drop by 21 percent.
Goods and Services Tax (GST) is an indirect tax which was introduced in India on 1 July 2017 and was applicable throughout India which replaced multiple cascading taxes levied by the central and state governments.
The prices of all goods imported from India will now fall by zero to 28 percent. This is as per the directive issued by the Office of Consumer Protection under the economic affairs ministry on August 28.