India's path to a $5 trillion economy involves significant legal and economic reforms initiated since 2014. Key reforms include the Goods and Services Tax (GST), which streamlined tax compliance, and the Insolvency and Bankruptcy Code (IBC), enhancing loan recovery processes. Additionally, initiatives like
Make in India and Production Linked Incentives aim to boost manufacturing and investment. The government's capital expenditure has risen, supporting infrastructure and attracting private investment. These efforts are designed to create a sustainable economic environment, fostering growth across sectors while aiming for comprehensive welfare.
Impact of Goods and Services Tax (GST) on India’s economic growth
The Goods and Services Tax (GST) has significantly impacted India’s economic growth since its implementation in July 2017. Research indicates that a 1% increase in GST revenue correlates with a 0.56% rise in GDP, highlighting a strong relationship between GST and economic performance.
GST has simplified the tax structure, reduced compliance costs, and eliminated the cascading effect of taxes, thus fostering a more competitive market environment . Additionally, it has increased taxpayer registration and compliance, leading to higher government revenues and improved ease of doing business, which collectively support sustainable economic growth.
Commentaires