blog comments powered by
GST is the biggest tax reform since independence which will affect how companies administer their business. The chemicals sector in India, in particular, is on tenterhooks regarding the result of GST implementation, considering the fact that Indian chemical industries have continued facing severe challenges owing to the mounting taxations.
The existing taxations have impelled the rise in the production costs of manufacturing vital chemicals, which has resulted in the price-hike of the end products and made such goods unaffordable for gross consumption.
However in GST regime, scene can be different as almost every predictable impact of GST on chemical industries looks positive.
That’s why the GST Bill is trusted to be seminal for the unbarred progress of the Indian chemicals industry in the years to come.
The prime benefit of implementing the GST legislation is that it will integrate the chemicals market by decimating the tax complications grappling the interstate trade of chemical companies. It will avoid any double taxation at combined rates and keep the rates of State-level tariffs consistent throughout the country. The inferring taxation will allow chemical manufacturers to produce chemicals and supply them to different States without any additional taxable duties.
The implementation of GST will result in exertion of IGST for interstate trade and SGST & CGST for transactions within a State. Consequently, the production costs and the resale prices of chemicals will be extensively lowered, urging the industry leaders to concurrently expand the gross production capacity of the chemicals sector in India.
The aforementioned benefits of lowered production costs and reduction of transactional tax rates will have a major influence on the growth of paints and construction chemicals industry.