GST- The Comprehensive Indirect Tax, Image Source: Public Domain

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As the clock struck 12 and it was 1st July 2017, India came under the ambit of a new set of taxes. For the first time in years, India was put to test with another set of financial reforms, after the demonetisation that took place in the previous year. People were definitely uncertain and apprehensive, however this time, the emotions weren’t as frantic. 

> No one was running around to banks and ATMs to get an exchange for their old currency stock. There was no turmoil, yet, it was not completely peaceful.

The tax reforms seemed foreign to millions across the country, they almost approached it with fascination. Little did they know, GST or Goods and Services Tax were proposed way back in 2000, it was merely an implementation after years of formulation. Over 17 years of thinking and propositions have gone behind the formulation of GST.

In 2000, Atal Bihari Vajpayee formed a committee. This was not just any committee, the committee was put into action to draft the GST law, and soon, the tax was approved by a task force. And so it began, the long tale behind the formulation of GST. 

> The law has been through several stallments and rejection before receiving the recognition it has today.

But, was everyone happy and satisfied with it? Well, most reforms receive hate from a portion of people it doesn’t necessarily benefit, and GST was no exception. While VAT (Value Added Tax) was cut off from the list of taxes to be paid, expensive products like petroleum were left out of it, simply because they are expensive. 

> This implies that those who purchase expensive products, like the rich, would definitely be filled with scorn for having to pay extra taxes. It became a hassle for businesses too. They were to cut off their expenses with GST refunds - extra tax payments which can be cut off from GST. Accountants were in great trouble during this phase.

But on the other side, the common man was satisfied. Bear with the jargon for a bit but the taxes levied at each stage of production were sized down to just one, holistic tax combined at the final stage. The cascading effect of taxes faded away, bringing in lesser compliances.

The road to GST, however, was filled with twists and turns, with the fear of actually finding potholes along the way. The steps along the way were alomst like tolls on the highways. At the first toll, GST Council was to be set up, which would solely work on the details of the bill and tax rate. 

The next toll entailed the bill be agreed upon by half the state assemblies. Finally, the last toll on this journey demanded the bill be okayed by the Rajya Sabha. Taa-daa! GST was all ready to set sail as a new tax reform in the country.

All in all, GST was eventually much appreciated as it slowly blended into our ways of life. A plethora of critics have much to say about it but eventually, it can be concluded that these were some of the best tax reforms for a vast and complicated country like ours.

A set of tax reforms were very strategically placed on the midnight of 1st July 2017. A comprehensive, all-inclusive tax that would make the system much more straightforward. But like every other reform, it received its share of backlash. Is GST really that new or is there more to the history of this significant set of taxes?