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GST will prove as the last straw to break the back of Indian economy

GST

Prime Minister Narendra Modi is trying to brand himself as a reformer by introducing and implementing a single tax regime of GST for the country but the real truth is small and medium entrepreneurs are being drastically crushed and the overall growth of the country is being adversely impacted in the coming years.

Nationwide protests are being held by traders and over one lakh textile traders of 165 markets in Surat are protesting since June 5 against the 5% Goods and Services Tax (GST).Prior to GST, there was no tax levied in the textiles sector.Traders in Modi’s own state Gujarat are on an indefinite strike to mount pressure on the government to roll back 5 per cent GST on cloth. But Modi led NDA government will turn a deaf ear to their demands.

According to government estimates smaller companies account for 45 percent of manufacturing and employ more than 117 million people.Suppliers are now coming under GST bracket which in turn form a tax credit chain. India still lags behind in manufacturing units because of unskilled labour, lack of investment in R&D, obsolete machines and technology  and many other factors. All Modi’s actions  have come to create utter joblessness in India and firms are becoming unable to dispose of their stock and are resorting to mass retrenchment.

Indian Economic growth grew from 6.4 per cent in 2013 to at 7.3 per cent in 2014-15 and larger percentage of business class in India consists of small businesses, traders  and unorganised sector. Indian public is still struggling after the sudden demonetization drive announced by Modi and now another setback in the form of GST is going to hit the informal economy drastically.

India’s manufacturing sector had the potential of touching US$ 1 trillion by 2025 which could create 90 million domestic jobs but now the combined effect of demonetization and increased tax in the form of GST will create mass poverty and utter distress in the middle class in the Indian society. India is already witnessing suicides due to Modi’s policies and Indian economy will crumble under his regime. He would, therefore leave India in ruins.

This new tax regime has been implemented to attract foreign investment in India which had declined immensely due to abrupt implementation of demonetization. And if foreign companies open their businesses in India, the capital will rather will take another flight from India.

arti bali

By : Arti Bali

Senior Journalist

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