The summer season is India

1. The summer season is India from the beginning of March and continues up to June. Up to February the rays of the sun are soothing and we like to bask in the sun. But in March the season changes. The Sun rays because hotter day by day and we begin to get perspiration. The entire earth becomes heated into his season.

2. In summer, the few hours of the morning ae pleasant. In March the sun does not become too hot before noon, but by April the sun becomes hot by 9 a.m.

3. The sun become very hot by noon in May and June and scorching winds also begin to blow. They it becomes very troublesome. People cannot come out of their homes and all work remains suspended till evening. They cannot work even inside their houses because of heat. Moreover, they do not feel energetic and a sort of dullness comes over them. They feel sleepy in the afternoon. They shut all doors and take rest in the coolest part of the building.

4. People do not get relief even in the evening and at night. They cannot sleep comfortably at night on account of heat.

5. Summer causes inconvenience in many other ways. The hot wind causes much thirst, but people cannot get cool water. Rivers and ponds dry up and cause scarcity of water. It adds to the difficulty of the people. Their throats and run from place to place in search of water. Many people, birds, and beasts die as a result of sunstrokes. Many fatal diseases, such as cholera, small-pox, etc. break out in the summer season.

6. People in towns have got many amenities which are not available to the villagers. Therefore, townsmen can reduce the discomforts of summer to a great extent, if they can afford to spend money. In towns, people get electric fan to cool them and ice of quench their thirst.

7. In spite of these disadvantages the farmers welcome the summer, because it brings the clouds which give them rain. Through we dislike the heat and dust of the summer; we await it anxiously because we get sweet mangoes during this season.

The Rainy season in India

1.       The Rainy season in India start in early July and continues up to September. It comes as a great relief to the world suffering from excessive heat and scorching rays of the sun. Birds, beasts, plants, and human being all welcome the rainy season, because it gives them the much-needed relief.

2.       When the rainy season starts, the sky is very often overcast with clouds and it presents a very beautiful scene. The clouds of different shades and colours move hither and thither in the sky and look very nice. Natural itself wears new apparel. The trees which shed their leaves in the summer come to have new leaves. New grass grows in the dry fields and they look like turf of green velvet. The wind blows away dust from the roads and they look neat and clean. When it drizzles for several days, the Kachcha roads, however, become muddy; Rivers, Ponds, and ditches are filled with water.

3.       The rainy season has both its advantages and disadvantages. Rain helps cultivation. Failure of rain causes famine and many people die. While it gives relief to the world suffering from heat, it also causes much inconvenience. People are confined to their houses and if they have to come out. They need umbrellas and water-proofs. The Kanhcha roads become muddy and it becomes difficult to walk on them. The rivers often overflow their banks and create much havoc. Too much of rain makes the roofs of houses leaky and the mud-built walls collapse and cause much damage to the household articles.

4.       Rain is a great boon to peasants. Without rain crops would not grow and agriculturists would be put too much loss. In India, agriculturists have to depend mainly on rain for cultivation and for the raising of crops on their lands.

The Diwali

1. The Diwali or the festival of lights is an important festival of the Hindus. It is held on the fifteenth day of Kartik.

2. On this day people clean their houses. All men, both rich and poor, get their houses whitewashed. In the night people illuminate their houses with small earthen lamps. Rows of small earthen lamps present a very beautiful sight. In big towns people illuminate their houses with electric bulbs instead of earthen lamps. It is the belief of some people that on the night of the Diwali, Goddess Lakshmi, who is the goddess of wealth, pays a visit to each house. She bestows her blessings on the houses which are neat and clean and turns her face against dirty houses. This is why everyday takes care to clean and decorate his house.

In the night people perform the Puja of the goddess and distribute sweets. In Bengal, Kali puja is performed on the night of the Diwali. Some people also indulge in gambling on this day. Boys purchase toys and feel very happy. They also make a display of fireworks.

3. There are many advantage of Diwali festival. On the occasion of this festival all the houses are repaired and cleaned at least once a year. The insects which gather round lights in the rainy season are destroyed and the light of Mustered oil makes the air pure. But there are disadvantage too. Many people lose much money in gambling and have to suffer in future. The fireworks also clause injuries to some people and houses too. It harms our environment.

Save Earth Save Life

Save Earth

We live on planet earth. We get everything for our life from mother earth. We should save our planet earth to ensure that our future generations get a safe environment.

How to save the earth?

We can save our planet earth by saving our trees, natural vegetation, natural resources, water, electricity. We can take measures for controlling environmental pollution and global warming.

Save trees. We should plant new trees plant trees. The schemes afforestation and reforestation should be wholeheartedly supported.

Save natural vegetation. We should use less paper. We can make arrangement for recycling of used paper and other natural products. Plants and trees covers and holds the surface of the earth.

Save natural resources. We all know that the supply of natural resources such as minerals, stones, coal, oil, etc. are limited. We can save electricity by putting off the lights when not in use. Or we can switch to fans instead of air conditioners during nights.

Save water. Water is life. It is the basic necessity for every human being living on this planet. We can stop throwing wastes into open water bodies. At home, we can use water cautiously and ensure that it doesn’t get wasted. Remember, a large many people are still deprived of safe pure water. “Be the change that you want to see in this world.”

Save environment from pollution. Don’t pollute water by not throwing wastes into waterborne.  Minimize air pollution by reducing harmful emissions. Use less car, less machines, less electricity, and less plastic goods.Eat organic foods.

Save earth from global warming. Industries should regularly check that their machines are emitting smoke within permissible limits. Ensure that wastes are discharged only after treatment.

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Market Economy: Meaning, Features, Advantages and Disadvantages

Introduction: An economy is usually composed of different players. The economy of a given region basically involves the production, distribution, and consumption of products and services within that area. It entails the activities that people engage in to earn a living.

Different types of economies exist. They are namely command, traditional, mixed and market economies. They all vary in how they function, with each having its own advantages and disadvantages.

A market economy has been favored by many governments because it promotes free trade by allowing the forces of demand and supply to determine the prices of products and services. Like the other types of economies, it has its unique features as well as advantages and disadvantages.

Meaning of Market Economy

When we talk about a market economy, what are we really referring to?

* A Market economy can simply be defined as a free market, one in which there are no outside authorities charged with determining the prices of goods and services or fixing them at a certain amount.

* In this type of economy, there is very minimal intervention by the government. This would be counterproductive since some parties would be disadvantaged.

* A market economy allows a free price system in that prices are determined by the interactions of several players within an economy. These interactions are usually between the buyers and sellers.

* It can also be said that a market economy is a type of economy where competition between businesses informs the cost of goods and services. Businesses fix prices of goods and services based on their need to make profits and the desire to outperform the competition.

* This is a type of trading environment where the government makes laws and provides regulations to guide operations but does not interfere with the actual pricing of goods and services. This is left to the market forces.

* There is unrestricted competition among private enterprises so that their prosperity is determined by how best they can capture customers and increase revenue generation. Every entrepreneur has a shot at success.

All these definitions help us to understand the key components of such an economy. It can be seen that it promotes free enterprise and allows business owners to make reasonable profits from their investments. The government merely acts as a supervisor of some sorts so that consumers are not exploited while entrepreneurs earn profits from their trades.

Features of a free market economy

As mentioned earlier, there are four different types of economies, each with its own unique characteristics. What are some of the key features of a market economy that make it different from the rest? Here are some of them:

1. Free market: This is a phrase that comes up quite often when speaking about trade and the economy in general. Most of the times we listen to experts talking about the need to have a free market if the economy of a nation is to thrive. It is a key feature of this type of economy but just what does it mean? When talking about a free market, we are referring to a business environment where the prices of products and services are controlled by the interactions between consumers and private businesses. The government does not act to fix these prices and its role is only limited to ensuring fair play to avoid customer exploitation. The laws of demand and supply determine the cost of goods and services and not some other authority. In a free market, no one person or even organization enjoys the monopoly of setting prices. In simple terms, in such a market, entrepreneurs trade in a business environment where they are allowed to operate freely but within the confines of the law. A free market is what really defines a market economy. It is the dominant feature that separates it from the other types of economies.

2. Free price system: This is another important feature of a market economy. The prices of goods and services are determined by the forces of demand and supply. The resulting price is what guides the production and distribution of goods. Take this for example; vegetables that are seasonal are more expensive when they are out of season than when they are in season. This is because the supply is high when they are in season and the opposite is also true. Forces of demand and supply work in such a way that when supply is high, demand and prices fall and vice versa. This is because the produce is readily available to retailers and obtaining them does not require a lot of resources. Farmers do not spend much in growing crops when the season is favorable as compared to when it is not. A free price system depends on these forces to attach value to a commodity or service.

3. Unrestricted competition among private enterprises: In a market economy, private enterprises compete for the available business space as well as the customers. They can increase brand awareness through advertising, better products and services offering, and improved customer services. This unrestricted competition allows businesses to focus on product differentiation rather than increasing the volume of production because that is what will attract more customers and increase sales. This healthy competition makes it possible for the most hard working business people with the best strategies to thrive. It works to the advantage of consumers by improving the quality of products that they are sold. It is to be noted that unrestricted competition is only allowed when ethical tactics are used to win over consumers. The regulations and policies that are put in place by the government ensure that consumers do not fall victim to false advertising.

4. Minimal government intervention: The government does really interfere with trade in a market economy. It does not get involved unless it has to. A scenario where the government can flex its muscles in a free market include cases of exploitation of consumers by enterprises. It does this by penalizing the businesses that do this and also by introducing legislation to prevent future occurrences.

5. Profit motive: One important aspect of a market economy is that businesses are motivated by profits. A company will craft strategies to attract the highest possible number of customers and generate maximum profits while consumers will want to buy the best quality of products at the lowest of prices. These are the dynamics of a market economy and the success of a business is measured by how much profit it rakes in. Retained profits are usually used as capital for expansion and business growth. Profits act as incentives that motivate firms to continue with business operations because, at the end of the day, there is a reward for all the work that is put in. Without reasonable profits, businesses would close shop since it wouldn’t make sense to continue offering products and services.

6. Consumer freedom: In a free market, consumers have the right to choose which business to engage with. They are not restricted to purchasing from a specific firm. The availability of different choices makes it possible for this to happen. Enterprises must, therefore, act to convince customers that they are the best options for them and provide incentives to retain them. It is this consumer sovereignty that pushes businesses to treat customers with decency since they always have the freedom of choice. A customer can decide to walk away from your firm and deal with the competition and that would put a dent in your business.

7. The power of information: Information is also a key feature in a free market. Businesses must use information to determine customer needs and preferences while at the same time consumers must make use of information to know the existence of a business and the best ones to buy from. There are different ways in which information is gathered by the different players in a free market. Customers can use the internet and social networks to gather this information while enterprises can use social intelligence strategies to know customer preferences. A company must keep up with the current trends if it wants to succeed because, in a free market, information is power. The ability for businesses to compete through product differentiation has made it necessary for them to know exactly what the consumer wants. These preferences change so rapidly and with the right use of information and technology, a firm can stay ahead of the competition.

Advantages of a Market Economy

When looking at the features, we’ve come across some reasons why this type of economy is good. We have seen how it can benefit the entrepreneur, customer, and the government. These are some of its advantages:

1. Competition and business success: It’s not bad to compete because competition actually pushes us to break the glass ceiling and see how great we can become. When businesses compete, they strive to become better by generating more revenue and realizing higher profits. An entrepreneur thus has the opportunity to expand his or her operations and achieve financial success. Without competition, they would be so complacent and would remain at the same financial position for a long time. A business owner would be so comfortable with the status quo that he or she wouldn’t see the need to push boundaries and grow. After all, what’s to bother you when you are assured of your market space? This is the reason why businesses that compete on a national or global level perform better than those that are localized.

2. Growth of the economy: The growth of a country’s economy depends on the growth of the private sector. It is not some work of magic that increases the Gross Domestic Product of a nation but the collective work of the private businesses. A free market promotes the growth of this sector and with it the thriving of a country’s economy. This carries several benefits such as improved living standards, more employment opportunities, and a higher life expectancy. The easiest way to kill the economy of a country is to interfere with the free growth of enterprises. A market economy, therefore, is beneficial in improving the economic outlook of a geographical region.

3. More investment by the private sector: Investors prefer market conditions where they are allowed to operate freely with minimum government interference. When such conditions exist, they are likely to invest more in the economy. As we’ve already seen, a thriving private sector is good for the economy of a country. Nations like the U.S have been thriving economically for such a long time because of a strong private sector. The realization of profits is such a good motivation that a lot of people will be willing to put in more work and reap the rewards. When more people opt to invest in the economy, higher growth is realized.

4. Consumer benefits: Consumers actually have a lot to benefit from a free market. Because businesses are competing to have the most number of customers, they focus more on product differentiation which is instrumental in ensuring that quality products are released into the market. Consumers, therefore, get value for money. Lack of monopoly also plays a key role in preventing the exploitation of consumers by businesses that are not experiencing any type of competition. The ease with which firms are able to enter the market and carve out a niche for themselves makes it a fair game. Consumers also have a lot of options to choose from and can still get quality products at the fairest of prices. When it comes to service delivery, a free market pushes firms to offer the best of services because that is what will help them stay in business. Look at what happens in sectors of the economy that are run purely by the government. The delivery of services is so pathetic but people still opt for them because there are no other options. Privatization makes it much better because of increased competition.

5. Businesses operate freely, hence more productivity: A free market is beneficial to entrepreneurs because they can operate freely. Freedom is actually a good thing because it encourages productivity. People are more productive when they do things because they want to and not because they are forced to do so. In a market economy, businesses operate with such freedom that they can thrive and grow way much faster than in a restricted economy. The ability to do business without unnecessary interference from the government triggers a chain reaction of great things such as increased investment and a better performing economy. If you pay attention to what has been going on around the globe, you’ll realize that there has been a raging debate on whether governments should place more restrictions on certain businesses in the economy or allow for more freedom. Many experts have been vouching for freedom because that is what promotes growth. Putting price caps and having several restrictions is counterproductive.

6. A smaller variant of Laissez-Faire: Less interference by the government means that businesses have the ability to operate in a fair trading environment. They can sell products at prices determined by market forces and get maximum incentives in the form of profits. A smaller variant of laissez-faire is definitely good for the economy because entrepreneurs will not be afraid to invest.

7. Increased Efficiency: Increased competition will give rise to increased efficiency. Firms will try to keep costs at a minimum and production high. Improved efficiency ensures that resources are not wasted and businesses focus more on streamlining their operations to make this possible.

Disadvantages of a Market Economy

It’s difficult to find a system that is completely perfect. Even though we strive to achieve perfection as time goes by and we learn from our failures and mistakes, there are still some areas that will always need adjustments. Here are some of the disadvantages of a market economy:

1. Poor working conditions due to the need for higher profits: Because entrepreneurs want to generate higher profits, they may compromise on the human resources just to increase their margins. This may lead to poor working conditions and pay. A business owner may pay his or her workers below the minimum wage in a bid to increase profits. Some also have their workers working in deplorable conditions because spending money to have an ideal job environment would reduce their profits. It has resulted in the creation of entrepreneurs who will do anything to make more profits.

2. Less social initiatives: This is also brought about by the hunger for more money. Rolling out social initiatives is seen to be eating into company profits and that is not something that an entrepreneur who wants to realize maximum profits would want. Social responsibility should be a moral issue for firms but in a free market economy, that is not something that a lot of companies focus on.

3. Inequality: A market economy has always been referred to as a capitalist market. It favors the accumulation of wealth by individuals who have the opportunity to do so. This creates a state of inequality between the haves and the have-nots. Unequal distribution of wealth results in many social problems because those who are less privileged or poor will try to use unlawful ways to gain access to wealth. People are not born equal and those who had a better foundation will always have a head-start in such an economy. The more privileged in the society may also use their positions to trample on the rights of the poor.

4. Environment and pollution: When people are motivated by profits, they’ll pay less attention to how their actions affect the environment. Business owners may engage in production activities that degrade the environment just to increase their profits. Without much government control, firms will not think about the consequences of their actions because after all, it is a free market.

5. No chance for the small person (Survival of the fittest) : In such a market, the fierceness with which enterprises compete makes it very difficult for small businesses to thrive. It is a matter of survival of the fittest and if you don’t have the resources to compete then you might as well close shop. An already established business can do everything possible to run you out of business. Only the fittest will survive in the face of ruthless and cut-throat competition. Where then does that leave the small person who is only trying to make it? The answer is “out of business”.

6. Economic disasters: Giving private businesses free reign can result into economic meltdowns on a global scale. Selfish actions by some of the players in sectors of the economy may lead to a build up of bad consequences. This has been seen time and again especially in the financial sector where profits are made at any possible costs and this often results in economic disasters.

7. Excessive control of private entrepreneurs: Private entrepreneurs may exhibit monopolistic tendencies by restricting output and driving up the cost of goods and services. Even without government input, there are still chances that some investors will create monopolies and exercise excessive control of some sectors of the economy. The rise of cartels is a common phenomenon in a market economy.

Conclusion

We’ve now looked at both the advantages and disadvantages of a market economy. From these, we have seen that it provides an avenue for wealth creation and allows entrepreneurs to prosper and have a better life. Everyone deserves a fair shot at success and a market economy provides that. Again like mentioned before, every system has its challenges. Nothing created by man is completely perfect since there is always room for improvement. Despite the demerits that come with the free market, the advantages are many and can be built on to have a better and thriving economy.

The government can enact relevant legislation that do not aim at controlling the market but provide policies that support transparency and limit criminal actions by companies. In this way, a system that supports economic growth and protects consumers is realized. It’s also good to have an economy that rewards hard work because that is what a market economy does. When all is said and done, having a free market would encourage entrepreneurs to invest more and as a result lead to improved living standards.

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Brief Note on Importance of Industrial Growth in Indian Economy

The Indian Government understood the importance of industries in India. The industrial policy undertaken on July 1991 by the Congress Government, have been designed to build on the past industrial achievements and to accelerate the process of making Indian industry internationally competitive, with a view to integrate the Indian economy with the world economy.

The Industrial Policy of 1991 put more importance on expansion of the private sector to introduce liberalization. While our original industrial policies were characterized by state interventions and control in the industrial sector, the new industrial policy gave more emphasis on de-licensing and decentralization.

However the role of the public sector in Indian economic development cannot be denied altogether. Public sector has contributed to a great extent in building the infrastructure, employment generation, capital formation, industrialization etc. in India. In spite of the important role played by the public sector enterprises, in recent years there has been a decline in the popularity of the public sector enterprises due to their unsatisfactory performance, such us, low returns on capital, inefficient and corrupted management etc. made public Sector enterprises a growing burden on government exchequer.


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Importance of Agriculture in Indian Economy

 Introduction: India is mainly an agricultural country. Agriculture is the most important occupation for most of the Indian families. In India, agriculture contributes about sixteen percent (16%) of total GDP and ten percent (10%) of total exports.

Over 60 % of India’s land area is arable making it the second largest country in terms of total arable land. Agricultural products of significant economic value includes rice, wheat, potato, tomato, onion, mangoes, sugar-cane, beans, cotton, etc.

Economic Growth: Agriculture is the backbone of Indian economy. Though, with the growth of other sectors, the overall share of agriculture on GDP of the country has decreased. Still, Agriculture continues to play a dominant part in the overall economic scenario of India.

Source of Food for domestic consumption: Food is essential for life. We depend on agricultural outputs for our food requirements. India produces large quantity of food grains such as millets, cereals, pulses, etc. A major portion of the food-stuffs produced is consumed within the country. Our farmers works day and night to feed our population that counts over 1.21 billion.

Besides agriculture with a commercial bias, subsistence agriculture with its emphasis on the production of food for the cultivator’s family is widespread. Traditionally, Agriculture is followed as the simplest method of obtaining food for the family. Agriculture in India is more a ‘way of life’ then a ‘mode of business’.

Export: India exports excess food and agricultural products. A large proportion of India’s export trade is based on the agricultural products, such as jute, tea, tobacco, coffee, spices, and sugar. It helps in increasing the foreign exchange. India is ranked seventh in terms of agricultural exports. In 2013, India exported agricultural products valuing around 39 billion dollars.

Basic occupation of millions: Agriculture is the basic occupation for majority of main-workers in India. A large number of rural women are also engaged in agriculture. According to 2001 census, over 56.6%  of the main workers in India are engaged in agricultural and allied activities.

Agro-based industries: A number of industries are agro-based industries, such as jute, cotton, sugar, tobacco, etc. Raw materials for such industries are supplied from agricultural produce.

Green revolution: Green revolution began in India with an objective to give greater emphasis on Agriculture. The era of Green revolution that began in 1960s witnessed significant increase in the production of food crops. The introduction of improved methods of agriculture and high yielding varieties (HYV) seeds, mainly wheat, had resulted into remarkable improvement in agricultural outputs. The productivity of land increased tremendously giving huge economic boost to the nation.

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Unemployment : Major Problem in India

One of the major problems of India is unemployment. Unemployment means the state of being without any opportunity of earning one’s livelihood.

In the good, old, golden days when the population of the world was smaller, there was hardly a person who was not employed in some way or other to earn a living. But this situation no longer exists. In those days most people lived in the rural areas and depended on agriculture and cottage industries. But industrial civilization brought about a change in the situation. It introduced machines, and as a single machine can do the work of many men, it naturally threw many persons out of employment. No doubt, this industrial civilization has greatly increased the wants of and opened up many new opportunities for employment. But this increase in scope for employment has not been able to absorb the men discharged.

However, the automation of works has complicated the unemployment problem in India. The highly sophisticated machineries are run by skilled and trained people. On one hand, the skilled people get employed in these large industries. But, the large masses of unskilled Indians finds it hard get a job that suits their skills.

The population of our country is ever-rising. The abnormal rise in population has intensified the problem of unemployment in India. That is why the problem of employment has been getting more and more acute every year.

It is the responsibility of the State to provide work to the people. But the number of the unemployed persons in India is increasing at an alarming rate. More than one-third of the total population still lives below the poverty line. The number of registered unemployed, not to speak of those whose names are not in the register is quite shocking. The number of job seekers also on the register of employment exchanges is increasing by leaps and bounds. There are three classes of employment here. In the villages those people who live on agriculture work for four or five months in a year, idle away the rest of the time. During that period they practically remain unemployed. In the towns and cities there is another class of unemployed people who find no employment in the factories due to the setting up of big machines there. Lastly, there are a large number of educated people who are unemployed. The masses, the uneducated and even the illiterate adopt some way or the other by means of which they can earn their living. The educated, however cannot do this.

Problem of employment among educated youth is a serious one. For every vacancy, there are dozens of applicants. Out of many candidates who are interviewed, only few gets the job. A student dedicates several years of his life in studies. It is a worry-some condition that even after getting Bachelor’s and Master’s Degree, these youth population of India are facing unemployment problem.

Solutions: The solutions for unemployment problem in India are dangerous for human being and we all have to find the solution regard this. :
 I am Writing some point at my point of view.


1. The villages should become self-sufficient in their economy and the villagers would not run to the cities in search of jobs. This would ensure that the large-cities are not overcrowded with huge population. It would help maintain the balance between the job/vacancy and the job seekers.

2. The system of present education should also be changed radically. Instead of giving only theoretical education the students should be given vocational training, so that they can start some work after they finish their education. These institute prepares a student with skill and knowledge for a particular trade. There is growing demand for skilled people in various industries.

3. The country should promote industrialization so that more job opportunities can be created for the workers. The focus should be on heavy industries that employs thousands of man-powers of varied skills.

4. Last, but not the least, to solve the problem of unemployment in India, the growth of population must be checked and the family planning programmes must be properly implemented.

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GST (Goods & Services Tax) : Details & Benefits (In INDIA)

The present structure of Indirect Taxes is very complex in India. There are so many types of taxes that are levied by the Central and State Governments on Goods & Services.
We have to pay ‘Entertainment Tax’ for watching a movie. We have to pay Value Added Tax (VAT) on purchasing goods & services. And there are Excise duties, Import Duties, Luxury Tax, Central Sales Tax, Service Tax.....😭😭😭😭😭😭😭😭😭

Intro

It has been long pending issue to streamline all the different types of indirect taxes and implement a “single taxation” system. This system is called as GST ( GST is the abbreviated form of Goods & Services Tax). The main expectation from this system is to abolish all indirect taxes and only GST would be levied. As the name suggests, the GST will be levied both on Goods and Services.
GST was first introduced during 2007-08 budget session. On 17th December 2014, the current Union Cabinet ministry approved the proposal for introduction GST Constitutional Amendment Bill. On 19th of December 2014, the bill was presented on GST in Loksabha. The Bill will be tabled and taken up for discussion during the coming Budget session. The current central government is very determined to implement GST Constitutional Amendment Bill.
GST is a tax that we need to pay on supply of goods & services. Any person, who is providing or supplying goods and services is liable to charge GST.

How GST will Applied

GST is a consumption based tax/levy. It is based on the “Destination principle.” GST is applied on goods and services at the place where final/actual consumption happens.
GST is collected on value-added goods and services at each stage of sale or purchase in the supply chain. GST paid on the procurement of goods and services can be set off against that payable on the supply of goods or services.The manufacturer or wholesaler or retailer will pay the applicable GST rate but will claim back through tax credit mechanism.
But being the last person in the supply chain, the end consumer has to bear this tax and so, in many respects, GST is like a last-point retail tax. GST is going to be collected at point of Sale. 

The GST is an indirect tax which means that the tax is passed on till the last stage wherein it is the customer of the goods and services who bears the tax. This is the case even today for all indirect taxes but the difference under the GST is that with streamlining of the multiple taxes the final cost to the customer will come out to be lower on the elimination of double charging in the system.

Suppy Chain of Tax in India 

The current tax structure does not allow a business person to take tax credits. There are lot of chances that double taxation takes place at every step of supply chain. This may set to change with the implementation of GST.

Indian Government is opting for Dual System GST. This system will have two components which will be known as

•     Central Goods and Service Tax (CGST) and
•     State Goods and Service Tax (SGST).

The current taxes like Excise duties, service tax, custom duty etc will be merged under CGST. The taxes like sales tax, entertainment tax, VAT and other state taxes will be included in SGST.
So, how is GST Levied? GST will be levied on the place of consumption of Goods and services. It can be levied on :

•     Intra-state supply and consumption of goods & services
•     Inter-state movement of goods
•     Import of Goods & Services

Benefits of GST Bill implementation

For the Centre and the States

According to experts, by implementing the GST, India will gain $15 billion a year. This is because, it will promote more exports, create more employment opportunities and boost growth. It will divide the burden of tax between manufacturing and services.

For individuals and companies

In the GST system, taxes for both Centre and State will be collected at the point of sale. Both will be charged on the manufacturing cost. Individuals will be benefited by this as prices are likely to come down and lower prices mean more consumption, and more consumption means more production, thereby helping in the growth of the companies.

•     The tax structure will be made lean and simple
•     The entire Indian market will be a unified market which may translate into lower business costs. It can facilitate seamless movement of goods across states and reduce the transaction costs of businesses.
•     It is good for export oriented businesses. Because it is not applied for goods/services which are exported out of India.
•     In the long run, the lower tax burden could translate into lower prices on goods for consumers.
•     The Suppliers, manufacturers, wholesalers and retailers are able to recover GST incurred on input costs as tax credits. This reduces the cost of doing business, thus enabling fairer prices for consumers.
•     It can bring more transparency and better compliance.
•     Number of departments (tax departments) will reduce which in turn may lead to less corruption
•     More business entities will come under the tax system thus widening the tax base. This may lead to better and more tax revenue collections.
•     Companies which are under unorganized sector will come under tax regime.

Advantage of GST Bill

Introduction of a GST is very much essential in the emerging environment of the Indian economy.

•     There is no doubt that in production and distribution of goods, services are increasingly used or consumed and vice versa. Separate taxes for goods and services, which is the present taxation system, requires division of transaction values into value of goods and services for taxation, leading to greater complications, administration, including compliances costs. In the GST system, when all the taxes are integrated, it would make possible the taxation burden to be split equitably between manufacturing and services.
•     GST will be levied only at the final destination of consumption based on VAT principle and not at various points (from manufacturing to retail outlets). This will help in removing economic distortions and bring about development of a common national market.
•     It will also help to build a transparent and corruption-free tax administration. Presently, a tax is levied on when a finished product moves out from a factory, which is paid by the manufacturer, and it is again levied at the retail outlet when sold.

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• Question and Answers on GST

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