An autonomous research institute under the Ministry of Finance


Emerging Issues in GST Law and Procedures: An Assessment

Publication date

Aug, 2021


NIPFP Working Paper No. 347


Diva Mehta and Sacchidananda Mukherjee


Adopted in 2017, the Goods and Service Tax (GST) marked the beginning of a new era in the history of indirect taxation of India – an era aspiring to realize the dream of ‘One Nation, One Tax’ for one of the biggest federal democracies in the world. In line with the fiscal federalism prevalent in India, GST has not only branched into IGST, CGST and SGST with different tax rates, but also has a provision for Centre-to-State compensations to make up for the losses incurred by the States during the transition phase of GST. 
For such an elaborate taxation arrangement to face bottlenecks, both at the time of roll-out and its subsequent expansion, is not unusual. A range of tailbacks are observed, ranging from the difficulties of transitioning from the earlier regimes, difficulties in the understanding the GST law(s), various technical, procedural and administrative glitches, and above all the complexity of Centre-State relationships.
On the fourth year of the adoption of GST in India, we revisit the big Indian dream of national integration via a single-spine tax system. We explore the issues in the existing GST systems to suggest probable solutions that can smoothen the way forward.
Key Words: Goods and Services Tax (GST), Value Added Tax (VAT), Input Tax Credit (ITC), Reverse Charge Mechanism (RCM), Input Service Distributor (ISD)
JEL Classification Codes: H20, H71, H73, H77
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