The Impact of GST on the Indian Economy and its Effect on the Banking Sector

Traditionally Indias tax regime relied heavily on indirect taxes. Revenue from indirect taxes was the major source of tax revenue till tax reforms were undertaken during the nineties. The major argument put forth for heavy reliance on indirect taxes was t hat Indias majority of the population was poor and thus widening base of direct taxes had inherent limitations. The biggest tax reform in India was the implementation of the Goods and Service Tax GST which was founded under the notion of “one nation, one market, on e tax”. The single biggest indirect tax regime was kicked into force from 1st July, 2017, dismantling all the inter state barriers with respect to trade. The GST rollout, with a single stroke, converted India into a unified market of 1.3 billion citizens. The banking sector is one of the most important sectors in India. It contributes nearly 7.7 towards GDP. It is one of the largest service sectors in India. The implementation of GST caused a major impact on t he banking sector resulting in shifting from the way they had been operating earlier. This paper would be about the Indian tax structure and the impact of GST on the Indian Economy and the banking sector. Vedant Mozumdar "The Impact of GST on the Indian Economy and its Effect on the Banking Sector" Published in International Journal of Trend in Scientific Research and Development (ijtsrd), ISSN: 2456-6470, Volume-5 | Issue-4 , June 2021, URL: https://www.ijtsrd.compapers/ijtsrd42341.pdf Paper URL: https://www.ijtsrd.comeconomics/financial-economics/42341/the-impact-of-gst-on-the-indian-economy-and-its-effect-on-the-banking-sector/vedant-mozumdar