The document discusses consumer buying behavior and the complexities of the Indian tax system, particularly focusing on the Goods and Services Tax (GST) as a reform to streamline taxation. It highlights the benefits of GST, such as transparency, uniformity across states, and improved compliance, while noting the challenges of implementation, including political resistance and the need for a sophisticated IT infrastructure. The success of GST is deemed crucial for enhancing economic growth and competitiveness in India's evolving market.

1. DONE BY
Dr.D.V.Ramana Murthy
D.Sailaja Devi
D.S.M.V.Vardhan

2.  refers to the buying behaviour of the ultimate
consumer.
 is the sum total of a consumer's attitudes,
preferences intentions, and decisions
regarding the consumer's behavior in the
marketplace when purchasing a product or
service.
 include things like physical factors, social factors,
time factors, the reason for the buyer’s purchase,
and the buyer’s mood.

4. Segments of different products
Source: India Brand Equity Foundation, January 2016

6.  Under CENTRE:
 Income Tax – on income, other than agricultural
income
 • Excise Duty – on goods manufactured or
produced in India
 • Custom Duty – on imports and exports
 • Service Tax – on specified services
 • Central Sales Tax – on inter-State sale of goods
 • Rates of Stamp Duty on 10 specified
instruments.
 CONCURRENT LIST OF BOTH:
 • Stamp Duties, not including rates of stamp duty
on 10
 specified instruments.

7. Under State:
 VAT/Sales Tax - on purchase or sale of goods, other
than newspapers, within a State
 Excise duty - on alcoholic liquor for human
consumption
 Rates of Stamp Duty – on other than 10 specified
instruments
 Land Revenue
 Tax – on agricultural income
 Toll tax
 Taxes on:
 Land and buildings
 Entry of goods in a local Area (Entry Tax)
 Consumption or sale of electricity
 Goods and passengers carried by road or inland
waterways
 Vehicles
 Professions, Trades, Callings and Employments
 Luxuries, including taxes on entertainment,
betting and gambling

8.  Tax Cascading (Tax on Tax)
 Taxation at Manufacturing Level
 Complex and lacking in stability
 Hidden tax on exports, no state tax on
imports & Exclusion of Services
 Finally “High transaction costs”
 Tax Evasion
 Corruption

9. BIGGEST TAX REFORM SINCE INDEPENDENCE….

10.  Goods and service tax (GST) is a
comprehensive tax levy on manufacture, sale
and consumption of goods and service at a
national level.
 GST is a tax on goods and services with
value addition at each stage.
 GST include many state and central level
indirect taxes.
 It overcomes drawbacks present tax system

28.  We all will pay GST on every product or service we buy.
 Since all indirect taxes levied by the States and the
Centre will be merged into one GST, we would exactly
know how much tax we pay which at present is difficult
to understand.
 No distinction would be made between imported or
Indian goods and they would be taxed at the same rate.
 The sellers or service providers collect the tax from
their customer.
 Before depositing the same to the exchequer, they
deduct the tax they have already paid.
 The success of GST would rest upon efficiency, equity
and simplicity.

29.  In Indian economy the service sector
contributes over 55%.
 Separate taxation of goods and services is
neither viable nor desirable.
 Value added in manufacture and sale of goods
require inputs of both — goods and services and
vice versa, which is often not separable.

30. GST levy will be administered by
 Union finance minister(chairmen)
 Union minister in charge of state revenue or
finance
 Minister in charge of finance or taxation.
 Any other minister(finance minister of the
state)nominated by each state gvt would constitute
the council.

31.  Dispute between state and centre will be
handled by the DSA.
 Appeal from DSA would be dealt with supreme
court.
 Example: if a state receives less revenue in
comparison with its previous one than it can
appeal this case to the DSA.

32.  There is resistance by the State Gov as VAT is
the main source of revenue for the State
Gov.
 In 246(a) certain powers are allocated to the
state government.
 The parliament & legislature of every state
will have the power to make law with
respect to goods and service tax imposed by
union(govt) or by the state.

33.  Transparent Tax System
 Uniform Tax system Across India
 Reduce Tax Evasion
 Export will be more competitive. As a developing country,
structure india needs a transparent & unambiguous tax.
 High transaction cost in the hands of the tax payers
 Increased tax collections due to wider tax base and better
compliance.
 Improvement in international cost competitiveness of
indigenous goods and services.
 Enhancencement in efficiency in manufacture and
distribution due to economies of scale.

34.  Dispute between centre and state over Tax
Sharing’
 Highly sophisticated IT infrastructure
required.
 Issue of taxing e-commerce is to be
appropriately addressed and integrated.
 Political Imbalance.

35.  More than 140 countries have already
introduced GST/National VAT.
 France was the first country to introduce GST
system in 1954.
 Typically it is a single rate system but
two/three rate systems are also prevalent.
Canada and Brazil alone have a dual VAT.
 Standard GST rate in most countries
ranges between 15-20%.

36.  Report says the proposed GST structure will
require the centre to coordinate with 29 states,
which is an administrative challenge.
 Even as the international monetary fund (IMF) says
the proposed goods and services tax (GST) will
improve tax compliance and enhance economic
growth by 1-1.5 per cent over time, it finds the
structure of the indirect tax regime in India
complex.
 “The GST design being contemplated is... Fairly
complex, with a dual administration arrangement
that involves the tax authorities of both the centre
and states separately taxing a single transaction,”
says the fund in a report on India.

38.  GST has huge influence on consumer & other stake
holders buying behaviour in spite of other factors
even.
 One of the most critical facts of this would be to
implement rational GST rates and create proper clear
cut awareness among the consumers as well as the
other stake holders.
 The strength of the GST framework depends strongly
in the ability of the government to install mechanism
to disputes from arising under new tax regime.
 with proper guidance to consumers & stakeholders,
both consumers as well as the government will
resolve the tax environment in India and finally GST
regime turns out to be not only comprehensive but
also revenue productive.