Can GST help Startups in India?

GST for Startups

Startups in India are a very trending topic. Startups are growing rapidly especially, the e-commerce sector. This rapid growth was even acknowledged by the government. 'Startup India' being one of the prominent proof. Startup India brought along many features including exemptions and benefits from certain taxes. This was done in order to attract Entrepreneurs. No one can deny that startups bring along a huge economic growth in India. Startups have generated employment and have contributed immensely to the economy of India. By 2020, Indian Government anticipates that there will be around ten thousand startups all over India. Startup India which gave many proposals in order to encourage entrepreneurs gave a proposal regarding GST also. GST or Goods and Services tax is an indirect tax which again helps the Government financially. Now, the question is how can GST help startups. How can a tax benefit startups? The same is discussed below.

GST has many features. Before seeing how they help startups, have a look at some of its salient features:

The 'simple' tax: It definitely is hard to believe. A tax which is simply seems impossible. But GST is a tax which is known for its simplicity. Filing taxes is considered to be a very tedious job. Entrepreneurs or anyone for that matter wants to avoid this overwhelming job. Authorities, therefore, need to try and simplify the whole tax procedure. At present, there is a long list of registrations under different kind of taxes. However, under GST, this complexity is overruled. GST combines many taxes including service tax, excise tax, VAT, luxury tax and much more. This way, entrepreneurs will be saved from different registrations. All taxes are combined at one place. One registration will suffice for all the other taxes. Handling one tax is way better than handling a whole bunch. Startup India introduces GST in the hope that entrepreneurs will find the financial world a lot more fun. This tax will simplify a lot of things for entrepreneurs. Filing income tax will become easy.

Economic changes: With the introduction of GST, economic changes are expected. Since most of the taxes are exempted; entrepreneurs will not need to worry about different taxes to be filed at various steps. So, an uninterrupted process is expected. Transportation charges are also decreased due to GST. The filing of taxes at every step is reduced to filing one tax at the final step. The transportation is also expected to become effective with the introduction of GST. Unification will be observed. This unification undoubtedly will increase efficiency.

The two forms of GST, that is, State GST and Central GST will ensure that both State and Central government are being funded but at the ease of entrepreneurs. This way both government and entrepreneurs can be satisfied with a rapid economic boom.

So basically, GST help startups by decreasing the complexity of taxes, unifying most of the taxes in order to make the whole procedure of manufacturing and distributing the products a lot more quick and easy. GST attracts entrepreneurs and makes the whole financial world a lot easier for them. We can, therefore, say that yes, GST can help startups in India. They simplify, unify and keep all the entrepreneurs at ease.