Further to my view points put forth in GD thread vide posts #574183 , #574430 , #574433 , #574680, #574681, I would like to give a few more points to explain my view point that GST is not beneficial to common man., but on the contrary it is beneficial to big corporate thus indirectly to political parties especially ruling parties at various times.
1. Now goods not conducive or harmful to the health of people are taxed extra by means known as 'Sin Tax',or 'deterrent tax' . Thus tobacco and tobacco related items are penalised making cost of Cigarettes etc more. Kerala state has started a'Fat Tax' on Pizza etc. That was to discourage and even prevent people from falling victims to such habits. That serves a social –health responsibility of the government. Now they are all out of extra taxation and are taxed as any other goods. This will pave way for higher social health cost which will only help to increase further taxation.
2. The government ha not agreed to put any higher cap for tax rates. That very clearly shows that there is always chance of higher rates of taxes. This will tear away the arguments of those who say that GST is good.
3. GST does not do away with or replace all kinds of taxation. It has just merged just a handful or less different taxes and fused them in one name.
4. Service tax is subsumed, but all services are included in GST as akin to goods. Those sectors now excluded may first resist an try to avoid but if compelled will simply transfer the burden on the final service user. So in effect there will be more items coming under service tax in the guise of GST.
5. The supporters of GST claim that litigation on tax matters will be reduced. That is not true. It depends on how clearly terms of implementation are worded and interpreted. Going from the experience of 'officialise' or the jargons and clause- in-clause wordings of our laws and rules, I am not that optimistic. The legal sector itself will be one which may start litigations as now they also come under service taxes if interpreted correctly.
6. The service sectors will try to avoid or reduce tax liability by terming the major part of service costs as reimbursements or revenue expenses etc which could be got back and tax exemptions obtained. That can defeat the expectation of higher tax revenue from service sector by GST.
7. The possible favourable points I see are (a) E commerce will get boost and more respectability. However as online shopping does not deal in day to day items generally, common man is not going to get much out of it. Moreover, as of now the scene is controlled by big multinationals.
8. There will be a little more ease for tax machinery. That is for the government and not for common man. Retailers have to continue with same formalities as earlier though in different names and forms.
9. The inclusion of petroleum products in GST is going to be a boon for the oil companies, which also mainly goes to the private corporate. Thos who had not reduced cost when internationalprice of crude fell by morethan half cannot be expected to reduce costs by a small cosmeticchange in taxa mechanis. This will actually leadto more price rise only.
10. As price control is not there GST will not prevent the manufacturers or providers from taking extra profit obtained from the subsuming of excise, service tax etc. Thus, my ultimate inference is that GST will be beneficial to corporate manufacturesr,traders and service providers. It has come out of the necessity of bringing investment especially in regard to 'Make in India' as the FDI investors need concesion and benefits. There is not even an iota of intention or aim of benefit and help to common man.
11. The only prayer is that let things not go worse to the common man who is already suffering and seeing the real colour of the government of not reducing even one rupee in railway tickets, but making railways also a greedy commercial corporate entity.
Let us keep faith on ourselves and work sincerely, not leave everything to fate.