An Analysis on the Impact of GST on the Fast Moving Consumer Goods Sector in India

Authors : Amrit Das

Volume/Issue : Volume 8 - 2023, Issue 3 - March

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The Goods and Services Tax (GST) is the most significant alteration to India's tax system. Products and services are subject to a variety of taxes, such as the excise tax, service tax, central sales tax, luxury tax, lottery tax, amusement tax, octroi, state surcharge, and other levies. The GST replaced a wide variety of indirect taxes formerly levied on consumer goods and services. Nine months have passed since GST was implemented on July 1, 2017, and both the federal government's revenue and the "cascading impact" of taxes have increased. GST has earned the label of "transparent taxation system" in the realm of indirect taxes. It's possible that GST still has certain current limitations, despite the fact that its future utility will increase. The structure of GST and its effects on the Fast Moving Consumer Goods (FMCG) industry in India will be the primary topics of this study. The fast-moving consumer goods (FMCG) industry did somewhat better after GST was implemented since it eliminated the multiple-tax structure. In terms of contribution to GDP, the FMCG industry in India ranks fourth globally. From $30 billion in 2011, the FMCG industry in India is projected to reach $74 billion by the end of 2018. The industry has grown mostly due to increased public knowledge, improved accessibility, and general shifts in consumer preferences and practices. If the GST Bill passes, it will have a big effect. Because of favorable tax legislation, firms are building distribution centers in several states. From the FMCG sector's standpoint, the GST will be more effective if enterprises share credits instead of keeping them. Modern FMCG network design is built on stock transfers and depot sales. Since the GST replaces indirect taxes traditionally imposed by the federal and state governments of India, it would affect the whole nation. FMCG has a large public impact. The FMCG business must carefully weigh the advantages and downsides of GST. So, the study looks at what effects GST might have on the FMCG sector. It also talks about the pros and cons of putting GST into place for the FMCG sector. The study also looks at how well GST works in the FMCG sector in countries that have already put it in place.

Keywords : FMCG, GST


Paper Submission Last Date
31 - May - 2023

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