Perceptions on affects of “GST” tax system on “MSME” sector

VIJAYAGIRI BIKSHAPATHI, Associate Professor and Head, Arts and Science College, Karimnagar, Telangana, India
Abstract
Goods and Services Tax (GST) is introduced on 1st July 2017 is a great historical reform in the Indian indirect tax system since from independence. This new taxation system was merged by pooling of various central, state and union territories’ tax into a single unified tax throughout the nation. The basic aim this is to remove the major drawback of the earlier taxation system that is cascading effect of tax or double taxation and to build a single common national market. This tax is beneficial to consumers in a major way that is in terms reduction in the overall tax burden on goods, which was estimated to be around 25%-30%. The study depends on both primary and secondary data. The secondary data was collected from Government of India Ministry of Micro, small and Medium Enterprises and also search of edited books, journals and websites. The primary data has collected from the key persons of the selected MSMEs who are actively involved in the managing the firms. The primary data with a sample size of 50 MSMEs has been collected within the vicinity of Karimnagar district, Telangana, India. As the MSME sector has also brought into the GST system along with large industries, the study throws light on the adoption of this changes over the previous system of indirect taxation. There are expectations, fears and disbeliefs in this new system of indirect taxation. It is noted that MSMEs contributing a prominent and significant level in the economy in India. The respondents of the study are from MSMEs in Karimnagar District, Telangana, India. The study reveals that as per the perceptions of the respondents, the performances of MSMEs are showing the positive association with the GST system. Hence the results of the study may be generalised and applied to others subject to the adoptability.

Keywords: GST, MSMEs, taxation, indirect taxes, cascading effects of taxation

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VIJAYAGIRI BIKSHAPATHI, Associate Professor and Head, Arts and Science College, Karimnagar, Telangana, India
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