Wednesday, October 27, 2021
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India Introduces One Nation One Tax

India goes ahead with the introduction of one nation one tax. It is one of the biggest tax reforms taking place in India. The one nation one tax came into existence with an announcement. India will join few of those countries which collect GST.

One Nation One Tax Boycott

The opposition parties are unhappy with the one nation one tax initiative. Congress calls it a tamasha. Opposition parties consider it as a unilateral decision by the party in power. The government seems to be less concerned about the reaction from the opposition parties. Congress party boycotted the meeting and the announcement. Other parties besides Congress opposing the initiative include DMK, RJD, Trinamool Congress. The Aam Admi did not show up either.

The Need for One Nation One Tax

The government terms the introduction of one nation one tax as the need of the hour. Indian Government’s Union Finance Minister says that the new tax will give India limitless possibilities. The minister believes the new initiative will help India achieve its real economic potential.

The aim is to bring the economy of USD 2 trillion under one tax net. The idea is to let the world access a single market of 1.3 billion people. It took India 17 years to consolidate all the current tax systems and come up with something implementable across the board.

One Nation One Tax

The one nation one tax initiative will help overcome the multi-layered tax system prevailing since independence. The net effect on the consumers is expected to be positive. The new move will contribute to reducing tax rates on products manufactured in India. Besides making the tax system simple, it will uniformly apply the same rate across all Indian states.

The positive impact of pricing will reduce tax compounding, which adds to product prices. The government of India is confident the new measure will help improve compliance. However, small business organizations are concerned about the implementation of the one nation one tax regime.

Reaction from the Traders on One Nation One Tax

Some cities protested by closing commercial and wholesale markets. Similarly, traders in Kashmir are observing a general strike. Protests were also seen in other parts of India against the new tax. Traders protested in West Bengal, Telangana, and Andhra Pradesh.

India Introduces One Nation One TaxThere were similar reactions from famous celebrities and people in business in India. Apparently, top of the list include Amitabh Bachan, Lata Mangeshkar, and Ratan Tata.

India’s experiment of demonetization and bringing more people into tax net did not go well. A lot of people spent days trying to get money out of the ATMs. Therefore, it will take time before we can know if the next tax experiment of one nation one tax delivers results.

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