Highlighting various benefits of historic tax reform, the Goods and Service Tax (GST), Finance Ministry has said that the new tax reform has resulted in formalization of economy and consequently information flow would eventually augment not only the Indirect Tax collections but also Direct Tax collections. Besides, the Ministry said that under the GST, there will be now seamless flow of availability of common set of data to both the Centre and the States making Direct and Indirect Tax collections more effective.
The Ministry further mentioned that GST is creating employment in formal sector and also eliminating transactions which are not recorded earlier in the books of accounts and thus, were outside the tax net so far. Besides, it said that the major tax reform is aimed to bring better tax compliance, transparency in tax system and it would make increasingly difficult for businesses to remain outside the tax net.
It also underlined the efforts being taken by the government for further simplification of GST structure, with an aim to facilitate the tax payers and to extend benefit to the customers, adding that an extensive exercise was undertaken for tax payers education & facilitation by way of knowledge sharing, dissemination of information and replies to FAQs among others.